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Giving your checking/savings account number to someone is incredibly insecure - they can debit your account! The routing numbers are public information. How can I have an account that only accepts deposits?

A very common example is paying by check - the recipient has your checking and routing numbers. This can and has been used for fraud.

In the banking world: I've had an account with OldBank, and recently opened an account with NewBank. In order to transfer money from OldBank to NewBank (both US banks), I could either give OldBank my NewBank login details (no, thanks), or verify two deposits < $1. Standard procedure.

The problem is that OldBank wanted my routing and savings account numbers of NewBank. I gave those and verified the two deposit amounts. Great. But then I saw that OldBank also withdrew an amount equal to the sum of those two <$1 amounts - which means OldBank can withdraw money from my NewBank account at any time.

That is not what I want. Compared to the Bitcoin/cryptocurrency world, the bank situation is ridiculously insecure. With Bitcoin (or any other crypto), you give someone your public receiving address(es), and keep your private withdrawal key. Anyone can deposit money into your account, but only you can withdraw. This makes perfect sense.

Is there an equivalent for banks in the US, or is the state of bank transfer security situation as ridiculous as the one with checks?

Are there US banks that allow designating accounts as "external entities can only deposit"?

How about foreign banks?

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A handful of banks simply refuse all external ACH debit requests. I'm not aware of any that let you choose.

But most US banks will allow you to maintain multiple accounts at no additional charge. Then you can use one account for linking to external accounts, and a different one for keeping your money. If you decline overdraft transfers, then without the account number for the second account, external banks can't touch your funds.

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The situation is actually worse than you think. The default position of North American banks is that if anyone who has your bank account details, and is a reasonably reputable financial institution, asks for money from your account then your bank will give it to them. There is literally nothing you can do to prevent this. The only way to prevent such unauthorized access is to change the account details. There are dispute procedures that may allow you to get your money back, but they are time-consuming and dependent to some extent on the goodwill of both financial institutions.

It's worth noting that most banks outside North America want to see the document that authorized the withdrawal before they let funds out.

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    "There are dispute procedures that may allow you to get your money back, but they are time-consuming and dependent to some extent on the goodwill of both financial institutions." What a terrible system is this? In Europe, the banks don't necessarily want to see the direct debit SEPA mandate, but if you found a debit to be unauthorized, you just tell your bank within 8 weeks (or, in certain circumstances, within 13 months) and it will immediately be reversed.
    – glglgl
    Feb 11, 2021 at 18:30
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This type of service does exist, although it is usually something attached to business banking accounts, not personal accounts. You are actually issued a second account number that is linked to your account but is deposit-only. You would just need to ask around at banks to see if anything like this is available for your personal account.

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    Do you know what this is called?
    – krubo
    Feb 18, 2019 at 3:50
  • That seems like it could be done "manually" by just getting a second account and setting up an automatic transfer of its full balance to your main account every hour, day, week, whatever.
    – Sparr
    Jun 4, 2021 at 8:30
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I never provide the log in details of an account to another financial entity. I agree with you, no thanks.

My experience in the US over 20 years (finite sample of 15 or so banks) is that when you do the two trial deposits routine, it only enables the sender of the deposits to have an active transfer link. To have it go both ways, it has to be done on both sides.

I would not be concerned about setting these up between two US banks that have routing numbers, FDIC insurance, etc. That makes them legitimate.

Though I have no experience with them, I would never do this with a foreign entity nor anything like Bitcoin or other. Subsidiaries of foreign banks meeting US regulatory standards (chartered in the US and members of the Federal Reserve) would be fine (Barclays Bank, Deutsche Bank, etc.).

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  • We can trust the banks, but what about giving checks to landlords? Say it's my last month at a landlord. I give them the last check. They put it on the table and have new tenants visit the place. One of them takes a photo of my check.
    – Dan Dascalescu
    Feb 13, 2019 at 20:32
  • Not only does the prospective tenant see your check but so does everyone who handles it, all the way to the teller at the bank who cashes/deposits it. Open a bank account, a brokerage account, pay your doctor with a check or a credit card. Your personal information is out there, everywhere (SSN, Drivers License #, DOB, credit card #s, account #'s, health information, tax returns, etc.).
    – Bob Baerker
    Feb 13, 2019 at 22:32
  • Credit cards at least have fraud protection as a standard feature, and there are many services offering one-time credit card numbers.
    – Dan Dascalescu
    Feb 13, 2019 at 23:55

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