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A marketplace platform allowing third-party sellers to list products was seeing fake or misrepresented storefronts slip through its manual seller-review process, leading to buyer disputes and damaged trust in the platform.
The Challenge
- Seller PAN and business registration checks were done manually
- Bad actors could game the review process with doctored documents
- Review backlogs slowed down legitimate sellers trying to launch
The Solution
Veriqos Technologies verifies seller PAN and bank account details automatically the moment a seller signs up, flagging mismatched or invalid details before a storefront goes live on the marketplace.
The Results
Fraudulent seller sign-ups are caught before listing instead of after buyer complaints, and legitimate sellers move from sign-up to live storefront significantly faster.
How marketplace seller verification fits the onboarding flow
The most effective place for marketplace seller verification is the moment a seller signs up, before a storefront can go live. Checking PAN and bank account details at that point stops fake storefronts early, when removing them costs nothing, instead of after buyers have already been affected.
A practical sequence is to confirm the seller’s PAN, check that the payout bank account belongs to the same person or business, and add a business registration check such as GST for sellers who claim to be a registered business. Each check answers a different question, so mismatches between them are often the most useful signal.
Genuine sellers benefit too: when the checks run automatically, they no longer wait in a manual review queue before they can start selling.
A seller verification sequence: GST, PAN, bank account and Udyam
Marketplace seller verification works best as a short sequence in which each check confirms the one before it:
- GST. Check the seller’s GSTIN with the GST Verification API to confirm the registration is active and to read the legal and trade names. Sellers below the GST registration threshold may not have a GSTIN, so let them start at the PAN step.
- PAN. A GSTIN contains the holder’s PAN in its third to twelfth characters. Confirm that it matches the PAN the seller gave you, then run PAN verification to confirm the name on it.
- Bank account. Verify the payout account with penny-less bank account verification and compare the account holder name with the PAN or GST name, using a name match score rather than an exact comparison.
- Udyam, where it applies. If a seller claims MSME status, a PAN to Udyam check confirms that a Udyam registration is linked to their PAN. It shows registration, not creditworthiness.
A mismatch between two steps is the most useful signal, for example a payout account in a name unrelated to the GST legal name. Send those sellers to manual review instead of rejecting them automatically, because sole proprietors often bank under a personal name.
More about Marketplace Seller Verification
To learn more about Marketplace Seller Verification, explore our GST Verification API and Company CIN Lookup v1 API, or talk to our team. For the official source, see the RBI’s KYC Directions for NBFCs.
