Types of Virtual Accounts from Hydrogen

Virtual accounts are an innovative solution that helps businesses manage payments more efficiently. Hydrogen offers two types of virtual accounts which are dynamic and static designed to meet the varying needs of organisations across different industries. Whether you're running an online store, an airline, or a logistics company, virtual accounts can streamline how you track and accept payments.

Let’s explore the features of these account types, how to integrate them, and where they fit best for your businesses.

What Are Virtual Accounts?

Virtual accounts are bank account numbers generated for businesses to collect payments. Each virtual account is unique, which makes payment tracking and reconciliation straightforward. Hydrogen offers dynamic virtual accounts, which are time-limited, and static virtual accounts, which are permanent.

Dynamic Virtual Accounts

Dynamic virtual accounts are temporary accounts created for a specific payment transaction. They expire within 30 minutes by default but can remain active for up to 48 hours upon request. Authentication for these accounts is managed using an API key that can obtained from the merchant portal.

Picture an online store hosting a weekend sale. When a customer checks out, a unique virtual account is generated just for that transaction. The account is valid for 30 minutes, ensuring that payments are prompt and secure. If the customer delays payment, the system automatically voids the account, reducing the risk of errors or misuse.

Integration

To use dynamic virtual accounts, follow these steps:

• Use the Initiate Transfer endpoint to generate a virtual account.
• Pass required parameters, including the payment amount, customer name, and email.
• Receive the account details, including the virtual account number, expiry time, and bank name.
• Share the details with the customer for payment.

The system tracks the transaction status and updates your records in real time. The account becomes invalid after expiry and can no longer receive funds.

Static Virtual Accounts

Static virtual accounts are long-term accounts tied to your business or individual customers. They are well-suited for recurring transactions or customers who make payments over time. Authentication for these accounts relies on an authorisation token, ensuring secure access.

An insurance company can assign a static virtual account to each policyholder. For example, when a customer pays their monthly premium, the static account records the transaction, allowing the company to track payments easily over time.

Integration

To integrate static virtual accounts:

• Use the Virtual Account API to create an account.
• Provide a label to identify the account, such as “Customer A - Insurance Premium”.
• Include customer details like BVN, NIN, or phone number for enhanced identification.
• The API generates a permanent virtual account number that is always linked to the customer.

Customers can then use their assigned virtual accounts for regular payments.

Differences Between Dynamic and Static Virtual Accounts

1. Duration of Use

Dynamic virtual accounts are temporary and ideal for single transactions. Static accounts remain active indefinitely and are suited for ongoing transactions.

2. Authentication Method

Dynamic accounts use API keys for authentication, while static accounts require an authorisation token.

3. Expiry Period

Dynamic accounts expire after 30 minutes by default, though the expiry can be extended to 48 hours upon request. Static accounts do not expire unless explicitly disabled by sending a request.

4. Use Cases

Dynamic accounts work best for time-sensitive payments, such as airline ticket purchases or food deliveries. Static accounts are better for scenarios like insurance premium collections or warehouse payment tracking.

5. Payment Reconciliation

Both account types support easy reconciliation, though static accounts are particularly effective for tracking long-term payment histories. Dynamic account offers endpoint to match payment history to customer details.

Hydrogen’s Instant Pay simplify payment collection for businesses, whether you need temporary accounts for quick transactions or permanent ones for recurring payments. Dynamic accounts work well for short-term needs, while static accounts are perfect for long-term payment relationships.

With easy integration and secure authentication methods, Hydrogen makes managing payments hassle-free. Whatever your business type, from logistics to insurance, virtual accounts provide a practical and efficient way to handle transactions.