Third-Party Verification (TPV) Definition

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What Is Third-Party Verification (TPV)?

A company may use an outside organization to perform a third-party verification (TPV) to review and confirm a customer’s information and intentions and thus ensure accuracy. Third-party verification is used with sales departments to verify that a potential customer has an interest in or agrees to purchase a product before passing the customer back or on to a salesperson. TPV is also used in situations in which a customer wants to provide or update information but cannot readily deliver a contract or physical copy of that information because the update is occurring over the phone or online.

Key Takeaways

  • Third-party verification (TPV) is when a company uses an outside organization to review and confirm a customer’s information and intentions to ensure accuracy.
  • TPV is also used in situations in which a customer wants to provide or update information but cannot readily deliver a contract or physical copy of that information.
  • TPV allows a company to reference the interaction history maintained by an independent third party in the case that a customer claims that they did not authorize an account change or transaction to take place.
  • TPV is sometimes required by law, especially with the increasing scrutiny of Internet security and do-not-call phone lists.
  • An example of TPV would be when a customer speaks with a cable television sales rep to make changes to a plan, for which a TPV will verify or record.
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Understanding Third-Party Verification (TPV)

Third-party verification allows a company to reference the interaction history maintained by an independent third party in the case that a customer claims that they did not authorize an account change or transaction to take place. In order to move out of the verification process, the customer must agree to consent to a transaction that is going to take place, which demonstrates that the agreement is legally binding.

Third-party verification is sometimes required by law, especially with the increasing scrutiny of Internet security and do-not-call phone lists. For example, any changes to telecom or utility (such as electricity or gas services) require TPV per the Federal Trade Commission.

Nowadays, third-party verification is the standard process for any transactions that occur over the phone or in a digital format where a signature or confirmation is unable to be secured. In 2018, the Federal Communications Commission passed a new rule to strengthen its TPV process after there were claims of misrepresented calls and fraudulent third-party approval processes.

Example of Third-Party Verification (TPV)

An example of third-party verification would be when a customer speaks with a cable television sales rep to make changes to a plan. After reviewing options and determining that the customer would like to proceed, and will accept a new contract for a period of time, the sales rep will conference to a third party. The TPV may just be a timed and tracked recording service that is a separate entity from the cable company. The sales rep will then review the changes and the customer’s personal information and have them verbally agree to the new contract on the recorded line.

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View more information: https://www.investopedia.com/terms/t/third-party-verification.asp

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