Recipient approval is a security feature within the OFX platform that requires a second person (an approver) to review and authorize any new or modified recipients before they can be used for payments.

How it Works

The workflow typically involves two primary roles: the Preparer and the Approver.

1. Creation or Modification: A user (the Preparer) adds a new recipient or edits the bank details (like IBAN or account number) of an existing supplier.

2. Needs Approval State: Instead of becoming "Active" immediately, the recipient record enters a Needs Approval status. At this stage, the recipient cannot be selected for new payments.

3. Notification: The designated Approver (e.g., a Finance Manager) is notified that a recipient record requires review.

4. Review & Action: The Approver opens the recipient summary, verifies the details against an official invoice or source, and selects either:

   • Approve: The recipient status changes to "Active," and they can now be used for transfers.

   • Decline: The changes are rejected, and the recipient remains in a Rejected or previous state, protecting the business from potential fraud.

Why is this important?

• Fraud Prevention: It guards against "Man-in-the-Middle" attacks where a hacker might try to swap a legitimate supplier's bank details for their own.

• Error Reduction: It prevents accidental data entry errors that could lead to payments being sent to the wrong account.

• Segregation of Duties: It ensures a clear professional boundary between those who manage vendor data and those who control the movement of funds.

Next Steps

• To set up a policy for this, refer to the following article: How do I set up a recipient approval policy?

• You can view recipients awaiting review by navigating to the Recipients page and selecting the "Needs Approval" tab.

Related FAQ Articles

• How do I create a policy for a recipient?