23 avril 2025
Counterparty Identification at nBanks: how does it work?
Discover how Counterparty Identification works at nBanks.
Discover how Counterparty Identification works at nBanks.
What is an Originator or Counterparty?
According to the Bank of Portugal, an Originator is the natural or legal person who holds a payment account and authorizes a payment order from that account. If there is no associated account, the Originator is the one who issues the payment order.
At nBanks, the term Counterparty is used as a synonym for Originator, representing the entity associated with a specific banking transaction.
How does nBanks' intelligence work?
The nBanks platform uses advanced algorithms to automatically identify the Counterparty of each banking transaction. It receives a banking transaction and verifies the data of that transaction to try to find the respective Counterparty.
The process is done in stages, with different levels of verification, in order of priority:
Identification via the transaction's IBAN (from the Bank)
The algorithm will use the information provided by the Bank, specifically the IBAN, to try to identify the Originator of the banking transaction.
Identification of patterns in the Transaction Description
When the IBAN is not available, the algorithm will try to identify an Originator through patterns in the banking transaction description.
Reading the Name associated with the Transaction
If the previous steps do not work, the algorithm will identify the name of the Originator present in the banking transaction.
Identification of the IBAN in the Description
If the IBAN is included in the transaction description, the algorithm tries to extract this information and verify if it corresponds to an IBAN already associated with an Originator (each Originator can have several associated IBANs).
Identification of the Name in the Description
As a last resort, the algorithm will try to identify a name present in the transaction description. This process is adjusted according to the origin bank of the transaction.
Counterparty identification colors on the nBanks platform
Blue - Confirmed by the Bank
nBanks' intelligence automatically identified and validated the counterparty based on information provided by the bank.
Yellow - Suggested by nBanks
nBanks' intelligence identified a counterparty suggestion that has not yet been validated.
Green - Confirmed by the user
nBanks' intelligence identified a counterparty suggestion and it was manually validated by the user.
How to confirm a Counterparty suggestion?
To confirm the Counterparty suggestion, the user must:
Select the suggestion given by the nBanks algorithm (in yellow);
Click the Confirm button.
Once confirmed, the Counterparty of the banking transaction appears in green.
How can the user help the algorithm in identifying the Counterparty?
Import Originators, via a file;
Manually create Originators;
For more assertive identification, and if the user manages several companies, it is important to pre-load specific Originators for each company;
The user should pay attention to the “Name” and “IBAN” fields of each Originator;
For the system to automatically identify the Counterparty in future transactions, the user needs to manually confirm the Counterparty of at least two banking transactions with the same description. If the user does not identify enough times, the algorithm will not be able to detect the Counterparty of the banking transaction.
What's next?
Currently, a Counterparty is only considered confirmed when manually validated by the user. However, as part of the constant evolution of our algorithm, a new version is being developed that will allow automatic confirmation of the Counterparty after three manual validations by the user, further streamlining the process.