Illustration: Annelise Capossela/Axios
IPID, which verifies recipient account ownership for banks, raised a $16 million Series A, CEO Damien Dugauquier tells Axios Pro exclusively.
Why it matters: Real-time payments give banks fewer chances to check recipient details before funds move, and fewer opportunities to recover money sent to a wrong account.
Follow the money: Foundation Capital led the round, with Citi and HSBC joining as strategic investors.
- Existing backers QED Investors, Monk's Hill Ventures and Quona Capital also participated.
The big picture: Banks cannot always check whether an account at another institution belongs to the intended payee, leaving them vulnerable to both mistakes and fraudulent charges.
- Wrong account numbers and bank codes can leave cross-border payments needing repair, which Dugauquier estimates happens to 5% to 10% of such transactions.
How it works: IPID has built connections to banks and local payment systems in more than 50 countries, giving customers a way to verify an account at another institution.
- It checks whether the account is open, compares the holder's name with the intended payee and identifies the account's currency.
- Banks can show a green tick when the details match or a warning sign when they don't, leaving the sender to decide how to proceed.
- Foundation Capital's Zach Noorani says banks "don't even really need an ROI case" for the check because customers expect confirmation when they add a new payee.
Between the lines: Dugauquier says IPID reduces failed payments and related support calls by about 70%, helping banks avoid repairs he estimates costs $150 per failed cross-border payment.
- IPID can also tell a bank what currency the recipient's account uses, allowing it to convert cross-border payments rather than leave that to the receiving bank, Dugauquier says.
State of play: Dugauquier named HSBC, Visa, Nium and Experian among IPID's largest customers.
- Citi also uses IPID to offer account checks to corporate customers through Citi Verify, giving IPID a way to reach businesses, Dugauquier says.
- The company says it now reaches more than 6,500 financial institutions and 4 billion accounts, covering about 85% of the world's banked population.
What's next: IPID is working to expand its coverage of U.S. bank accounts and develop similar checks for stablecoin wallets, Dugauquier says.
