Account validation isn’t just a box to check for compliance—it’s the foundation of trust in the payments ecosystem. As credit-push fraud surges and financial institutions face pressure to safeguard transactions, account validation has become a frontline defense to avoid money being sent out of accounts through ACH credits, wires, cards, and other instant and digital payments. This year, Nacha will roll out new monitoring rules intended to reduce the incidence of successful ACH fraud attempts and improve the recovery of funds after frauds have occurred.
That shift is forcing financial institutions to think differently about how they validate accounts and stay a step ahead of fraud. In a PaymentsJournal webinar, Charles Ellert, Associate Managing Director of ACH Network Development at Nacha, and Hugh Thomas, Lead Analyst, Commercial and Enterprise at Javelin Strategy and Research, unpacked what’s changing and shared how Phixius—Nacha’s secure payment information network to mitigate payment risk and for enabling accuracy of payment routing—is evolving to help organizations strengthen their fraud defenses.
Why Credit Push Fraud Is Growing
With the growth in electronic payments, there has also been an increase in the number of credit-push fraud schemes, including a frightful rise in business email compromise attacks. Between 2022 and 2024, an estimated $8.5 billion was lost to this type of fraud, according to the FBI’s Internet Crime Complaint Center (IC3).
When this occurs, ACH originators may struggle to verify account details. “When I was on a corporate side, that was a constant worry,” said Ellert. “The teams would spend hours verifying account details just to make sure a payment landed in the right account. It slowed things down and added significant cost, but it was the only way to be safe.”
How Account Validation Can Help
A single wrong digit can send a payment astray. That’s why modern account validation methods have become so valuable. They transform a manual, error-prone process into one that’s secure, fast, and reliable.
Account validation helps keep payment processes secure in several key ways. By verifying accounts from the outset, it reduces the need for exceptions and rework. It also speeds up onboarding for new vendors and customers, since processors no longer have to wait for manual confirmations. Perhaps most importantly, it protects brand reputations by preventing misdirected or fraudulent payments before they happen.
Organizations are now using validation data to improve everything from payment analytics to customer experience. What began as a compliance exercise has evolved into a broader operational strategy—one focused on building trust into every transaction, rather than simply checking a box.
“I was persistently struck by the variety of different ways that this type of validation work has been attempted in the past, doing a penny test or mailing a check in,” said Thomas. “There is a certain consistency that is a very broad need among B2B payers.”
Enter Phixius
Many financial institutions are evaluating their existing controls and looking for ways to step up their operational readiness. Phixius, an API-based platform that facilitates secure data exchange between account validation requesters with data responders, is one option helping ODFIs support compliance efforts while improving efficiency and reducing fraud exposure. More than just a tool for meeting new requirements, it’s a way for banks to get ahead of them.
Phixius is designed to support account validation and other payment-related needs without requiring sensitive information to be stored or transmitted through traditional channels. It is a powerful tool for improving payment integrity and operational efficiency, especially as institutions prepare for the 2026 fraud monitoring rules.
Phixius acts as a bridge between data requesters and responders, helping organizations validate account details in real time. This reduces fraud risk and streamlines onboarding—eliminating the need for transactions or micro-deposits or having the customer share their check.
“It’s a kind of one-size-fits-all,” said Thomas. “It gets you hooked into all the places you want to be in terms of understanding who you’re paying, it’s a repeatable process, and because it’s an API driven process, it’s an embeddable process.”
Requesters are seeing reduced fraud exposure, faster onboarding, and fewer exceptions. By validating account information in real time, they’re improving operational efficiency and embedding trust into the payment process from the start.
“I spoke to a corporate just the other day who was facing leakage of benefit payments to some of their former employees,” said Ellert. “Because of that, they got a new email and changed their bank account. No one validated that account name match or was associated with it. That is something where Phixius can come in and help validate that the payment information is correct before you submit it.”
Phixius is also uniquely positioned to help organizations rethink how they assess transaction risk. Payroll disbursements, for example, carry far greater risk than a $20 monthly bill payment—and pulling funds involves a completely different risk calculation than pushing them.
There are still untapped repositories of account data that can inform better decision-making. Phixius allows institutions to incorporate these data sources into their risk signals, gaining deeper insight into where funds are going and how to manage risk more effectively.
“Let’s say you get one questionable response,” said Ellert. “If you’re sending a big amount of money, maybe you want to check two or three more of them, and build that into your risk profile.”
Preparing for the Future
Phixius is evolving to address the growing complexity of account validation and fraud prevention for ACH and other payment types. Its capabilities are expanding to support broader validation needs—from onboarding new customers and verifying account ownership to reducing exceptions in both B2B and B2C payments. It’s scaling to support more credentialed participants and to integrate more deeply with financial institutions and service providers.
Looking ahead, Phixius aims to deliver secure, real-time data exchange that helps participants stay ahead of compliance requirements while improving operational efficiency and trust in payment processing. For financial institutions, the imperative is clear: waiting on account validation is no longer an option.
“It’s foundational,” said Ellert. “Start now, evaluate your current processes, explore trusted platforms like Phixius, and position your organization to not just comply, but to lead.”
