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Straddle provides an Identity Verification module specific for Business Customers, operating in similar ways to our Identity Verification module for Individuals. This guide will walk you through the process of onboarding business customers using Straddle’s API.

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Onboarding Business Customers Using Straddle

To onboard a business customer using Straddle’s API, you’ll need to follow these steps:
  1. Collect Business Information: Gather the necessary information about the business, including: EIN, Legal Business Name, Business Address, and people associated with the business.
  2. Submit Business Information: Use Straddle’s API to submit the business information using the POST /v1/customers endpoint.
  3. Verify Business Identity: Straddle’s Identity Verification module will process the submitted information and generate a result for the business identity verification.
The process is similar to the individual identity verification process, but with additional fields for business-specific information.
Business identity verification will only be triggered if the Compliance Profile (EIN and Legal Business Name) and Address are provided. It will be skipped if not, and the customer will be moved directly to verified status.

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Business Identity Reason Codes

When using Straddle’s API for business verification, our system performs comprehensive checks on the business information you provide. These checks generate Business Identity (B) codes that offer insights into the verification results and help you make informed decisions about your business customers.

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Overview

Business Identity codes are alphanumeric identifiers that start with the prefix “BI” and provide specific information about the business verification process. These codes help you understand:
  • Whether the submitted business information matches official records
  • The validity of the provided tax ID
  • Potential discrepancies in business names or addresses
Business verification is crucial for regulatory compliance and fraud prevention. Always review these codes carefully to understand verification outcomes.

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Interpreting Business Identity Codes

Business Identity codes typically fall into several categories, each providing information about different aspects of the business verification process:

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Business Name & Tax ID Verification

These codes indicate whether the provided business name and tax ID match official records:

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Address Verification

These codes help verify the submitted business addresses:

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People Affiliation

These codes provide information about the relationship between the submitted individuals and the business:

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OFAC / Sanctions

These codes indicate whether the business or associated individuals appear on sanctions lists:

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Registration & Standing

These codes provide information about the business’s registration status:

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Address Characteristics

These codes provide additional information about the nature of the business addresses:

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Location Usage

These codes indicate how many other businesses are using the same address:

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Entity Type

These codes identify the legal structure of the business:

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Business Formation & History

These codes provide information about the business’s establishment and history:
If you encounter any Business Identity codes not listed in this documentation, contact Straddle support for clarification. Our verification system is continuously evolving to provide more detailed insights and better fraud protection.

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Using Business Identity Codes in Your Application

When implementing business verification in your application, you can use these codes to:
  1. Automate decision-making based on verification outcomes
  2. Implement custom workflows for businesses that require additional review
  3. Provide specific feedback to users about their verification status
  4. Track verification metrics to identify common issues or trends

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Best Practices for Business Verification

To maximize the effectiveness of your business verification process:
  1. Implement a tiered verification approach: Use Business Identity codes to create different levels of verification based on risk and business type.
  2. Collect comprehensive business information: The more detailed and accurate the initial business information, the more reliable the verification results will be.
  3. Consider industry-specific risks: Some industries may require additional verification steps due to higher risk profiles.
  4. Provide clear feedback to users: When a business fails verification, provide specific guidance on what information needs to be corrected.
  5. Monitor verification patterns: Track common rejection reasons to identify potential improvements in your onboarding process.
  6. Implement periodic re-verification: Business information can change over time, so consider implementing periodic re-verification for long-term customers.
For businesses that require manual review, consider requesting additional documentation such as business licenses, articles of incorporation, or utility bills to verify the business address.

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Business Identity Scores

Straddle’s Business Identity scores are calculated based on the Business Identity codes and provide a numerical representation of the business’s verification status. These scores are not directly related to the business’s creditworthiness or financial health. The Risk Scores range from 0 to 1 in the API, and are based on the number of codes in each category. The higher the risk score, the more scrutiny the business should receive in the event of a review status being assigned to it.

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Testing Business Identity in Sandbox

In Straddle’s Sandbox environment, you can test Business Identity verification by providing specific data in the address object, a business customer type, and data in the compliance_profile. Each input maps to a specific outcome. Any data that is not in the above list will return a random result while in Sandbox, but always return the same output for the same input.