BSB validation API: How to use it to improve customer experience

How to improve your customer experience with Zai's BSB validation API
Jan 19 2023
Payments Insights

min remaining

If you accept payments via bank deposit and are looking for a way to guarantee that your customer has transferred funds to your account via a BSB validation API, you’re probably dealing with:

  • Being at the mercy of the banks to know if a customer’s funds have been securely transferred.

  • Customer experience that is clunky and has high drop-off rates.

  • Potentially large volume transactions that are not settling.

  • Having to validate transactions manually, which is time consuming and costly.

  • Being unable to trace a payment from a bank account.

In this article, we’ll break down:

Looking to implement a BSB validation API right away? You can check out our API documentation and get in touch with one of our experts today.

The issues with accepting deposit bank transfer as a payment method

As a fintech, remitter or crypto exchange, there are a few issues you may face when it comes to accepting payments.

Clunky UX leads to a bad buying experience

Your customers are probably going through the following user flow: to send funds or add funds to their account on your platform, they need to first head to their bank account, input details, include a customer reference number and push the payment manually.

This is a clunky user experience because customers might:

  • Input the wrong bank state branch (BSB), account name or customer reference number, which means the payment won’t go through and will have to be reversed. Banks sometimes charge fees to reverse a transaction and this can take a couple of days.

  • Not have their bank details on hand to log in and process the payment, which causes them to abandon the process or delay making the transaction until they have their details.

  • Forget to send the payment and leave the platform.

Even if the payment is successful, it might take multiple days for the account to be updated. This can cause the customer anxiety about whether the payment has been processed and leave a negative first impression of your platform and company.

Customers might also hesitate to process a payment if there is no guarantee that the funds will be transferred, which translates into lost customers.

Not tracking the account number means you have less information on hand

The New Payments Platform (NPP) is advanced enough to confirm that the customer has input the right BSB number. When an NPP payment is initiated, the payer's bank confirms the customer has the required funds and the payee bank confirms that the recipient account exists and is able to receive NPP payments. That’s why most banks will confirm the BSB number and tell the customer by displaying the bank name and branch name that they are sending it to the right Australian financial institution.

However, the NPP won’t tell the customer if they are sending funds to the right bank account, meaning the funds will go to the account the customer has initiated payments to, but that doesn’t necessarily mean that it is the intended recipient (as customers may enter an incorrect BSB number).

Not tracking the account number means that it can take even longer for your company to find the payment and update the customer’s account. It also means you’ll have to manually find the account they’ve sent money to and then reconcile it.

This can take a couple of days, which leads to a poor buying experience for the customer, and a higher cost of resources for you.

How Zai’s API works

The best way to solve this issue is to implement a BSB validation API via the New Payment Platform and by using PayID as an addressing method, which will validate both the BSB and the customer’s account number.

At Zai, we’ve built multiple APIs for different payment methods and use cases, and we understand how important it is to be able to validate payments.

Our banking partner allows us to offer our clients the functionality to validate a BSB and account number. That means that with our real-time payin API, you can validate the BSB and account number of a payment. Your customer is therefore guaranteed that their funds are processed, and once the payment is through, they will see an update on their account almost immediately.

Here are the various features and benefits worth mentioning about our API.

Track BSB number and account number, so you can guarantee funds are transferred

By tracking the BSB and account number, your customer will be able to see that their payment is guaranteed and confirmed. This BSB lookup and validation technology is usually enabled via the bank’s back end, but thanks to our banking partnership, we can confirm this via our ecosystem, allowing you to guarantee funds immediately if the payment is done via the NPP.

This process is what allows the customers to see their payment confirmation within minutes, making them feel at ease with their purchase.

Validate the account number so the customer’s account is updated instantly

With our API, we’ll use webhooks to send instant notifications when a fund has been transferred. This will integrate into your platform, which means that when a customer sends funds, their account on your platform can be updated instantly.

You can also use the real-time payin API to gather as much information on the transaction as possible, including the Bank State Branch (BSB) number it belongs to. For example, with a crypto exchange, we can ensure the funds are sent to your specific company and to the customer’s wallet inside that platform.

Add multiple payment methods to improve user experience

At Zai, we’re more than an API provider. We offer a whole suite of payment solutions and operate as your payment orchestration partner.

That means that you can offer multiple payment options – not just a deposit transfer. By working with us, you’ll also be able to offer card payments, BPAY, direct debit, and more.

By offering multiple payment methods via Zai, all payments will arrive in one virtual Zai account. This makes reconciliation a lot easier. It also means we can offer real-time payments, which are especially useful for payments that have liquidity on both sides of the transaction, such as an investment or crypto platform.

Set up a custom payment solution that integrates seamlessly with your platform

You may have a custom enterprise resource planning (ERP) or customer relationship management (CRM) system and are looking for a customisable payment solution.

We only work with APIs, which means our process can fit into yours and we can work around your current setup. With our API, we’ll make sure to integrate with yours.

We are also locally based in Australia, which means we can offer personalised support and guide you through every step of implementation.

Example of Zai’s API in practice: Coinjar

As we mentioned above, being able to validate funds for a crypto exchange is especially important. This is because the deposits are usually relatively high value, and, since markets move quite quickly, customers need to be able to deposit and transfer funds quickly as well.

We worked with Coinjar to help implement faster payments on their platform. As their Group Financial Controller, James Elia, explains: “Customer interest in a real-time payment capability was immense, if their payments to friends were being sent instantly with PayID over the NPP their expectations for the speed at which they send money to CoinJar to buy digital currency was no different.”

By working with Zai, Coinjar was able to integrate with the NPP and offer real-time payments as well as an enhanced BPAY service. It only took three days to complete the integration, since Zai’s API allows a single integration for both BPAY and real-time payments.

Now, Coinjar gets payins into the system quickly, which allows pro-traders and corporates to begin trading quickly. Customers can also receive funds very quickly and don’t have to wait for days to get their funds.

“The biggest benefits have been the speed of service and payments platform stability,” says Elia. “We’ve been able to attract more corporate clients, including other digital currency exchanges, thanks to our premium service.”

Implementing this has reduced the time it takes to turn corporate prospects into clients by 50%, and their customer deposits now clear within 60 seconds.

Read the full case study here: Coinjar: How real-time payments translated into faster conversions

Use Zai’s real-time payments API to offer better UX to your customers

With a BSB validation API, you can ensure your customers feel safe when sending funds to your platform. This is especially true if they are a new customer or the value is high and could be the difference between losing or gaining a customer.

By working with us, we’ll be able to connect you to the real-time payment rails, while giving customers a guarantee that their payment is processed.

Want to learn more? Reach out to one of our experts to get started with our APIs.


This information is correct as of January 2023 This information is not to be relied on in making a decision with regard to an investment. We strongly recommend that you obtain independent financial advice before making any form of investment or significant financial transaction. This article is purely for general information purposes.

Stay up to date

Get our latest article directly into your inbox. No spam, just insights from the world on online payments from our experts.