In the early days of PayPal there was an important need to be able to ensure that the user had control of the bank account she was linking to her PayPal account. There was no commercial service that provided this and banks certainly weren’t interested in verifying user information so that PayPal could enable alternative payments.
What Sanjay Bhargava came up with was basic but quite clever: sending to the user’s bank account two random deposits of amounts much less than $1.00 each and requiring the user to login to their bank account, see the amounts of the two deposits and enter those amounts into PayPal. A simple, effective and clever solution!
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