Built on LSTM-based natural language processing algorithms and deployed through a cloud-native architecture, Waldo provides a robust API delivering high-accuracy name matching with exceptional performance. By accounting for cultural, typographical, and formatting differences, Waldo helps organizations improve data quality, streamline operations, and enhance the customer experience.
WARNING: NERDS ONLY

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Overview

WALDO stands for Weighted Algorithm for Legitimate Data Ownership. It is Straddle’s proprietary identity matching algorithm designed to securely and accurately verify that a customer’s identity matches the ownership details of their bank account. Determining if two name strings refer to the same individual is deceptively complex. Traditional string comparison methods often fail to capture the multidimensional nature of name representation, resulting in high rates of false positives or false negatives. Name variations arise in many ways. Common names frequently have multiple accepted spellings, such as “Jonathan” vs. “Johnathan,” and informal nicknames (e.g., “Elizabeth” vs. “Liz,” “Beth,” or “Betty”) complicate matching further. Cross-cultural factors introduce additional layers, as names transliterated from languages with different alphabets can appear under multiple spellings (e.g., the Russian “Михаил” might be “Mikhail,” “Michael,” or “Mihail”). Variations in name ordering, suffixes (“Jr.,” “Sr.,” “III”), and honorifics (“Dr.,” “Prof.”) also add complexity. Finally, typographical errors and data-entry mistakes create further inconsistencies. This multidimensional challenge leads to significant business costs when simplistic approaches produce poor results. Waldo is designed to address these complexities, facilitating more accurate name recognition and reducing operational risk.

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The Need for Advanced Identity to Ownership Matching

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Importance of Accurate Identity Matching

  • Security: Ensures that only authorized individuals can initiate transactions.
  • Trust: Builds confidence among users that their financial information is protected.
  • Compliance: Satisfies legal obligations for identity verification and fraud prevention.
  • Efficiency: Reduces false positives and the need for manual reviews.

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How WALDO Works

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Name Normalization

Waldo first normalizes input names by:
  1. Converting characters to a common case and trimming extraneous whitespace.
  2. Identifying and separating suffixes (e.g., “Jr,” “Sr,” “II”) from the main name components.
  3. Standardizing punctuation (e.g., handling “O’Brien,” “O Brien,” “OBrien,” “O-Brien” consistently).
This step removes superficial formatting discrepancies, reducing false negatives that arise from differences in casing, punctuation, or whitespace.

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Name Variation Generation

Waldo generates multiple plausible variations for each name, reflecting common changes seen in real-world data:
  • Reordering: First name–last name, inversions, and optional middle names.
  • Nicknames: Associating formal names with known diminutives (e.g., “Robert” → “Rob,” “Bob,” etc.).
  • Initials: Handling records that use initials instead of full names.
By comparing an expanded set of variations for each input, Waldo finds matches that simpler approaches would overlook, reducing false negatives.

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Similarity Calculation

  1. Pairwise Comparisons: For each variation of name1 and name2, Waldo applies specialized string, cultural, and phonetic comparisons from the HMNI library.
  2. Maximum Similarity Extraction: The system takes the highest similarity score across all variation pairs, representing the closest possible match.
  3. Business Rules: Additional refinements incorporate domain logic—for example, distinguishing family name matches vs. first-name inconsistencies.
  4. Score Normalization: The final score is normalized to a 0–100 range, enabling straightforward thresholding and integration into client workflows.
This multistage process yields substantially higher accuracy than simple string comparison methods, crucial for real-world data sets prone to typographical errors and diverse naming conventions.

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Integration with Pay by Bank

1

Customer Identity Verification with Straddle ID

  • Data Collection: The customer provides personal information during onboarding.
  • Real-Time Verification: Straddle ID verifies the customer’s identity using various data sources and compliance checks (KYC, AML).
  • Identity Profile Creation: A verified identity profile is created for the customer.
2

Bank Account Connection via Bridge

  • Customer Authentication: The customer authenticates with their financial institution using the Bridge widget.
  • Account Ownership Details Retrieval: Bridge securely retrieves the account ownership information.
3

Identity Matching with WALDO

  • Data Normalization: WALDO standardizes data formats.
  • Feature Extraction: Extracts features from both the verified identity and bank account data.
  • Machine Learning Models: Utilizes models to predict the likelihood of a match.
  • Weighted Scoring: Assigns weights to different features based on their significance.
  • Threshold Evaluation: Compares the weighted score against predefined thresholds.
4

Outcome Determination

  • Successful Match: Proceed with Paykey Generation.
  • Mismatch Detected: Error handling and user notification.

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Business outcomes

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Identity to Account

WALDO significantly improves security for merchants, financial institutions, and payment providers. Its advanced name matching technology ensures that only rightful account owners can link and use bank accounts for transactions, bolstering A2A (account-to-account) payment flows by verifying ownership in real time. Beyond initial account connection, Waldo continuously verifies ownership over the lifecycle of a connected account, detecting changes in legal names or multiple authorized users. This constant vigilance reduces the risk of account takeovers and safeguards against fraudulent connections.

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Fraud Prevention

Waldo acts as a frontline fraud detection tool by instantly spotting mismatches between verified identity details and bank-account ownership records. Subtle name variations associated with legitimate users are correctly recognized, whereas truly inconsistent identities are flagged before transactions occur. Because Waldo accurately accommodates name variations, it also reduces false positives in traditional fraud-detection systems. Straddle can maintain high security standards without unduly inconveniencing legitimate customers.

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Reduced Friction

Despite its sophisticated security, Waldo remains invisible to legitimate users:
  1. Identity Verification: Straddle ID confirms the user’s identity upon onboarding.
  2. Bank Connection: The user authenticates with their financial institution via Straddle Bridge.
  3. Name Matching: Waldo automatically compares the identity data to account ownership details in under 100ms, ensuring continuity and generating a resuable, secure “paykey” token if a match is confirmed.
Customers enjoy a frictionless experience while benefiting from heightened security measures.

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Regulatory Compliance

Waldo underpins compliance efforts with regulations such as KYC (Know Your Customer) and AML (Anti-Money Laundering). By ensuring accurate identity matches and reducing false positives, it eases investigation workloads, streamlines watchlist checks, and empowers organizations to focus resources on genuine risks. Waldo’s refined approach also supports ongoing customer due diligence by detecting subtle naming inconsistencies that might indicate attempts to bypass controls.

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Future Enhancements

Straddle will continue advancing Waldo to meet emerging demands:
  • Broader Cultural Support: Enhancements for diverse naming conventions (e.g., Hispanic structures, transliterated non-Latin scripts, multi-part names).
  • ML-Enhanced Algorithms: Integrating LSTM improvements through real-world usage feedback, creating a hybrid rule-based and machine-learning-driven system.
  • Custom Threshold Configuration: Allowing different similarity thresholds for specific risk tolerances or business contexts (e.g., stricter compliance vs. customer onboarding).
  • Name Standardization API: Providing configurable tools to unify naming conventions across systems, with cultural nuance to avoid “one-size-fits-all” formatting.
These future capabilities underscore Straddle’s commitment to delivering the industry’s leading solution for name matching in increasingly global and digital markets.

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Frequently Asked Questions

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Conclusion

WALDO offers a dynamic solution to the challenges of accurately matching personal names in modern payment systems and data-driven environments. The algorithm synthesizes advanced linguistic processing with domain-specific rules, delivering high accuracy and real-time performance. Architecturally, Waldo embodies best practices in software design—cleanly layered, modular, and cloud-native. Comprehensive monitoring and logging tools further ensure reliability in production. From a business standpoint, Waldo drives tangible value by increasing data quality, improving the customer experience, mitigating fraud, and streamlining compliance processes. As digital transformation accelerates worldwide, name matching plays a pivotal role in ensuring secure and reliable account-to-account payments across industries.

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Additional Resources

Thank you for taking the time to learn about WALDO. We are committed to supporting you in delivering secure and efficient payment solutions.