The new service’s goal is to prevent money transfer scamps and incorrect payments by checking the name of the person or company one is sending money to online. Announced in October 2018, ‘Confirmation of Payee’ is meant to double-check whether the name attached to a payment matches the sort code and account number, and to warn if it looks like one is about to send money to the wrong account.
The Payment Systems Regulator has consulted on making the solution compulsory for all banks by July 2019. Moreover, it suggested two main deadlines: by 1 April 2019, banks should have the capability to respond to ‘Confirmation of Payee’ requests from other banks. And secondly, by 1 July 2019, banks must send ‘Confirmation of Payee’ checks to their customers when they make a transfer online.
However, UK Finance, a trade body that represents banks, has affirmed that the timeline is not achievable, suggesting that some banks wont be able to begin to implement the system until 2020. It has continued by saying that banks capacity to meet these deadlines is limited due to other pressures including new Open Banking regulations and Brexit.
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