Failed and returned payouts
A failed payout is rejected before it reaches the payee. A returned payout reaches the receiving bank or wallet and is sent back.
Definition
A failed payout never reaches the payee, for example because a compliance check stops it or the bank details are invalid. A returned payout arrives at the receiving bank, which then rejects it and sends the money back.1
Common causes
- Wrong account number, IBAN or routing details1
- Name on the account does not match the payee
- Account closed or blocked1
- Receiving bank rejects the currency or payment type
- Sanctions or compliance checks stop the payment
How to reduce failures
- Let payees enter and confirm their own payment details
- Validate IBANs and account formats before the payout
- Use a payee name check where one exists, such as Verification of Payee for euro transfers in the euro area since 9 October 20252
- Let payees confirm their email, account or wallet once during onboarding
- Tell the payee the exact reason and how to fix it when a payment comes back
How Talentir helps
Payees enter their own payment details in Talentir and confirm their email, social account or wallet before their first payout. See how Talentir handles compliance
Further reading
Related topics
KYC and KYB
KYC (Know Your Customer) verifies a person's identity. KYB (Know Your Business) verifies a company, its owners and the people who act for it.
Payout methods
A payout method is the rail that delivers money to the payee: bank transfer, digital wallet such as PayPal or Venmo, or stablecoin.
Settlement
Settlement is the moment money actually arrives and is final in the payee's account, as opposed to when the payment was sent.
AML (Anti-Money Laundering)
AML rules require financial companies, and some other businesses, to prevent, detect and report money laundering and terrorist financing.