Microdeposits
Overview
Microdeposits are small test transactions, usually under $1, sent to a bank account to verify ownership and validity. Customers confirm the amounts received, proving they control the account. This method is commonly used in the US and other regions without real-time account verification. While reliable, it can take several days, creating delays in onboarding.Financial institutions, payroll providers, and fintechs use microdeposits to reduce fraud and ensure funds are linked to the correct account. Regulators view them as a secure though slower method for account verification. With instant account verification (IAV) gaining traction, microdeposits are increasingly a fallback method where APIs are unavailable.
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