Flexible Business Funding in South Africa: How It Works
March 20, 2026Disclaimer:
This blog offers general guidance based on information available at the time of publication. For the most up-to-date details, please contact Netcash or other service providers directly.
Is your business dealing with failed payments and fraud in online transactions? You’re not alone. Every year, companies lose millions because of payment fraud.
But there is a way to cut those losses by verifying payment details in real time when adding new suppliers, employees, or debit order accounts. Account Verification Service (AVS) and thorough risk reports provide a practical way to reduce failed or rejected payments.
This guide walks you through how AVS and risk reports work together to help you detect fraudulent activity, flag risky transactions, and reduce payment failures. Through these simple steps, you can learn to plug these tools into your setup, stop revenue leaks, and build absolute trust with your customers and suppliers.
Ready to transform your payment security and boost transaction approval rates? Dive into this practical guide and start reducing fraud and failed payments today.
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Reach out to Netcash to explore reliable solutions that ensure seamless transactions.
What are AVS checks?
AVS is a key service performed by select banks and third parties, like Netcash, that verifies the account holder’s name and number against bank records. These checks typically occur when you process a new debit order mandate, add a new supplier, or add an employee to the payroll.
AVS checks require details such as the account number, branch code, recipient name, and ID number. For companies, Account Verification Service assessments are conducted using the business registration number and bank account details instead.
If the details match, the system verifies the account, and future transactions will be approved. If not, it will fail, and you’ll have to ask the account holder to check whether they provided the correct details.
Types of AVS: AVS in real-time vs batch validation flow
Two types of AVS checks can be performed when adding new bank account details to your systems: real-time and batch verifications. Let’s take a look at their differences.
AVS-R (real-time)
As the name suggests, this verifies bank account details and the holder's identity in near real time. This verification works for one account at a time, approving instantly when there is a match, and flagging mismatches immediately to prevent fraud before funds move.
Because of this, it is better for smaller data streams, such as eCommerce or point-of-sale payments, that require rapid processing. These checks would apply to applications in fraud detection, customer data validation, form submissions, and shipping charge calculations.
AVS-B (batch)
Batch checking allows banks or third parties to verify multiple accounts at once. You can run these high-volume assessments by sending a single request file to BankservAfrica, which then distributes the account details to the various relevant banks for verification. It is ideal for debit order runs or salary batches.
Why businesses need AVS in South Africa
South African businesses need AVS to prevent payment fraud, reduce errors, and stay compliant with financial regulators such as FICA and POPIA. In addition to fraud prevention, it also acts as a risk management tool, safeguarding against scams like “change of banking details”. This is when fraudsters pose as suppliers and request a change of account details to divert funds.
AVS also assists businesses in limiting unpaid debit orders. By ensuring that accounts are active and valid, South African businesses can rest assured that payments will be received.
Thanks to the extra layer of security that AVS provides, businesses reduce reliance on manual bank validation processes, freeing up staff to focus on core business operations. AVS is also cost effective, preventing failed or misdirected payments, which cuts down transaction costs.
Sectors that can benefit from AVS
Numerous sectors in South Africa can benefit from bank verification, which is critical for combating identity theft and unauthorised transactions.
- Banking: Major South African banks, such as ABSA, FNB, Standard Bank, Nedbank, and Capitec.
- Telecommunications: Giant telecommunications service providers like TransUnion verify customer details to prevent identity fraud and unauthorised account openings, which can lead to financial losses.
- Insurance: AVS helps companies verify customer bank account details and their validity to ensure monthly premiums are paid.
Common failures and fixes for account validation
Account validation may fail for a few reasons. The solutions range from quick fixes to more extensive bank-side maintenance. Here are some common reasons for AVS failure:
- Incorrect bank account details: Typos and inaccurate data are the most common causes of verification failures. But they are the easiest to remedy. Always double-check banking details with staff, customers, and suppliers to ensure all information is up to date.
- Inactive bank account status: Closed or inactive accounts will get an “inactive” result.
- Mismatch in customer details: If the employee’s, supplier’s, or customer’s bank details and name or ID don't match, the AVS system will return an “unmathed” result. This could be because of an error at the bank or a simple typing mistake.
- System issues: Sometimes the problem is not with the customer but with the payment system or the databases themselves. If this is the case, re-trying at a later stage works.
How Netcash’s account verification service makes it easy for your business
The entire AVS process completes within seconds and can be done through Netcash's Risk Reports dashboard. It offers you the option to perform bulk Excel imports or integrate with APIs to make the process easier and faster.
With Netcash, you can handle debit orders, salaries, and supplier payments with total peace of mind knowing that payments are received or made from or to verified and active accounts.
AVS for debit order collections
AVS greatly contributes to setting up recurring debit order collections. It confirms a customer’s account details directly with their bank before attempting to collect funds. The system verifies that the account is active and accepts debit transactions. This increases business’s collection ratios, improves cash flow, and helps them avoid failed debit orders thus lowering admin costs.
Benefits of AVS for debit order collections with Netcash
- Improved accuracy and reduced errors: Skip manual checks, minimise human error, and confirm that customer details match before debit orders are processed. This ensures funds are collected from the right accounts, avoiding disputes.
- Reduce bank charges: Every failed debit order collection results in bank charges or failed collection fees from payment service providers (PSPs). AVS helps you avoid these costs by preventing the debit order from being submitted in the first place.
AVS for payroll in South Africa
Payroll teams process monthly bulk payments, often onboarding new staff or updating details. Account verification plays a vital role in South African payroll by confirming employees’ bank details before salary distributions, ensuring funds are sent to the correct recipients.
Batch AVS suits payroll perfectly, handling bulk verifications via Excel uploads and catching detail mismatches, inactive accounts, or incorrect owners before payday.
Benefits of AVS and batch processing for payroll with Netcash
- Boost employee trust: Similarly to improving payment accuracy, verifying payslips means no payment glitches. Now, employees can see reliable, on-time salaries, cutting payroll queries and building confidence in your systems.
- Prevent employee fraud: AVS checks verify that the account belongs to the person intended to receive the payment. This helps you mitigate the risk of fraudulent redirects or paying “ghost employees”.
AVS for supplier payments
AVS plays a key role in supplier payments. It verifies that the beneficiary’s bank account details match the records held by their bank before funds are transferred. Ensuring that suppliers are paid not only keeps operations going smoothly but also strengthens your business’s reputation.
Benefits of AVS for supplier payments with Netcash
- Reduce fraud and payment errors: Confirm the legitimacy of supplier accounts to avoid making payments to fraudulent or inactive accounts.
- Save on admin time: Should there be a mismatch between the supplier account details you have and their bank records, your staff will have to manually check where the error occurred, eating up precious time that could be used on core business processes.
Understanding risk reports
Once the AVS check is complete, it’s time to verify the legitimacy of the people and establishments you deal with. This is done through risk reports.
These reports pull data from trusted sources such as banking records, credit bureaus, and government registries. They provide accurate insights into the creditworthiness of customers and businesses.
The types of risk reports available include:
- Bank account verification
- Business-linked consumer reports
- Consumer credit checks
- Company reports from the Companies and Intellectual Property Commission (CIPC).
How Netcash can help with risk reports
Netcash provides a variety of detailed risk reports that equip you with the information you need to make well-informed decisions.
Our systems support:
- Bank account verification reports that match a bank account number to an ID or company registration number to ensure payments go to the correct party.
- Run ID and credit checks on job applicants to verify employment details and block internal fraud, particularly for finance roles.
- Review consumer credit reports for payment trends, debts, and overall risk to safeguard your business.
- CIPC business reports to verify company legitimacy and principal clearance.
Benefits of Netcash risk reports
- Reducing risk: Verifying that bank account numbers match an individual's ID or a company's registration number ensures payments go to the right parties.
- Knowing your employees: ID verification and consumer credit checks confirm the information provided on employment applications.
- Avoiding fraud: Risk reports help prevent potential fraud and vulnerabilities by providing a continued view of the risk landscape.
- Managing financial risk: Businesses can make informed decisions when dealing with customers and creditors by using detailed credit and business reports.
Protect your business with safe and secure payments.
Contact us for more details today!
Frequently asked questions about South Africa’s cashless economy
Bank account verification and fraud prevention are made easy with Netcash
If you’re tired of losing money to failed payments and fraud, there is a straightforward way to protect your business. By using real-time Account Verification Service (AVS) and Netcash’s comprehensive risk reports, you can reduce payment failures and money loss without disrupting your customer, supplier, or staff experience.
It is a simple process that takes only a few minutes to set up, but can save you a lot of time (and money) in the long run for your business. Don’t let fraudsters threaten your company any longer. Start implementing these defence measures today to safeguard your payments.
Looking for more ways to secure your business?
Contact us today and take the next step toward safer transactions.
Author:
Paul Adant
Business Solutions Manager
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Paul has over 30 years experience in banking and the payment industry, he has a passion for translating needs into effective solutions. Cultivating strategic partnerships with integrated software vendors and producing cost effective, efficient and time saving business solutions make him a valuable member of the team at Netcash.
