Here’s When It’s Safe to Share Your Bank Details (and When It’s Not)

You are wrong if you are worried about being deceived; Fraud in general is on the rise (and anyone can be a victim ), and losses associated with various types of fraud will exceed $10 billion in 2023 alone. Old-fashioned bank fraud, including check fraud , is also on the rise, which may seem surprising since the use of paper checks has since been declining. Although we’re writing fewer checks, the value of those checks has risen from an average of $673 in 1990 to $2,562 today , making them an attractive target.

But eliminating paper checks won’t protect you from fraud. Paying for online purchases with credit cards or similar tools includes some built-in fraud protections , but there are times when using an electronic check and withdrawing funds directly from your bank account is preferable (when a “convenience fee” is charged for using a bank account ). credit card, for example), or you may receive money via bank transfer. Either way, you’re suddenly faced with having to reveal your bank details—routing number, account number, and bank transfer or SWIFT codes—to complete the transaction. And you might reasonably wonder if it’s safe to simply divulge this information.

Answer: Yes, in general. But that doesn’t mean you shouldn’t be careful.

Banking information to keep an eye on

A summary of the relevant details we are talking about here; when I say “bank details” I mean:

• Routing Number : A nine-digit code that identifies your specific bank.

• Account Number: The number of digits in your account number may vary. This is a unique identifier for a specific account at a bank or financial institution.

• SWIFT code. If you need to send or receive money overseas, you may need a Society for Worldwide Interbank Financial Telecommunications (SWIFT) code . This is an eight to eleven digit number that identifies your bank.

• ABA Number: Also called a “transfer routing number,” this nine-digit code is an alternative method for transferring funds internationally.

Most of these numbers are pretty easy to find. If you have paper checks issued by your bank, the routing number is printed at the bottom left and your account number is printed to the right of it. You can usually find your bank’s routing number, SWIFT and ABA codes by logging into their website, calling and asking, or simply searching them online .

As I said earlier, your routing and account numbers are literally printed on your checks. These numbers are used in what are called Automated Clearing House (ACH) transactions to move money between different banks and accounts. This means that anyone who sees your check also sees your ACH information—and with that information, they can commit fraud on your accounts quite easily . So when should you worry?

When can you share your bank details?

First, pay attention to the fact that you constantly share your routing number and account numbers. Every time you send a check, sign up for direct deposit, or enter your banking information to pay your taxes or utility bill (or sell tickets on StubHub ), you share these numbers. They are there. A few things to keep in mind:

• Just having your account number is pointless. No one can do anything using just your account number. They also need your bank’s routing number.

• As noted, your bank’s routing number and ABA and SWIFT codes are public information and can be found online, so there’s no reason to guard them with your life.

So when should you feel safe sharing your banking routes and account numbers? A few recommendations:

• If you are comfortable writing a check, you can usually provide your bank details.

• If you know why you’re being asked to provide this information—for example, you’re creating an account, making a direct deposit, or paying a bill using ACH to avoid a fee—it’s generally fine.

• If there is a legitimate and compelling reason why the organization needs this information (such as direct deposit) or you have a compelling reason to offer it (such as avoiding fees when paying with a credit card or PayPal).

Keep in mind that when you give someone permission to use ACH to access your bank accounts, you can always revoke that permission , and you generally have 60 days to report fraud involving your bank account as an individual.

When should you worry?

Of course, scammers can wreak havoc on your financial life if they get both your routing and account numbers, so you’ll definitely want to think twice before giving them out. Here’s when to worry:

• Insecure communications. Never give out your bank details to anyone who asks for them via email or text message.

• Links provided. If you are sent a link to enter your bank details, be suspicious. Always go directly to any company or organization’s website to enter your route and account information.

• Pressure. If you prefer to use another form of payment (such as a credit card) but are forced to provide your bank details, be suspicious.

Bottom line: the key is your account number. Without this, scammers can’t do anything, and they can figure out everything else on their own, so if you don’t give your account number, there’s not much they can do to you. On the other hand, if you need to receive payment by bank transfer or pay a bill using your bank account, it is usually safe to provide your bank details while you wait for the request. Just be careful if it’s unexpected or if you don’t understand why you need to provide this information.

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