The UK's Confirmation of Payee rules introduce name checking to reduce misdirected payments and APP fraud. Providers implement the service, respond accurately and present match outcomes before payment, with reporting on implementation and performance where directed by the regulator.
TL;DR:
- Checks recipient names against account details before relevant Faster Payments and CHAPS transfers.
- Match, close-match and no-match results help prevent errors and APP scams.
- A match supports the payer's decision but does not guarantee a trustworthy transaction.
Summary
Checking the name as well as account details
Confirmation of Payee allows a provider to check the name associated with the intended recipient's account alongside the sort code and account number. It addresses a gap in a payment journey that otherwise relies heavily on numerical account details. The service is relevant when setting up a new payee or changing details, before the payment is sent, rather than being a retrospective investigation of every completed transfer. Identifying the intended account before sending also differs from proving the purpose or legitimacy of the transfer.
Match outcomes support the payer decision
PSR describes match, close-match and no-match outcomes that can alert a payer and allow correction before sending. Those results help reduce accidental misdirection and certain scams, but a matching name does not establish the legitimacy of the underlying purchase or request for money. Account identification and confidence in the transaction itself are related but different questions.
Expansion through regulatory directions
PSR first directed the six largest banking groups and later expanded the service through additional directions, including Specific Direction 17 and its provider groups. This means the legal obligation is tied to the direction and relevant PSP category. A list of examples or a historic implementation milestone should not be treated as a complete substitute for assessing whether a particular provider falls within the directed perimeter.
Provider implementation and the wider fraud framework
The requirements concern implementation and operation of the name-checking service, including the responses and information presented to users. They sit alongside APP-fraud prevention and reimbursement arrangements rather than replacing them. A firm's compliance therefore needs to be understood through the applicable direction, service role and current implementation requirements, while the customer still receives a separate outcome if a payment later becomes disputed.
Keywords
- CoP
- UK transfers
- account-name checks
- Faster Payments
- CHAPS
- match results
- payer warnings
- PSR directions
- misdirected payments
- APP prevention