According to Deutsche Bank’s “Funds Transfer Regulation 2015: a regional regulation with a global impact” whitepaper, financial institutions and regulators require a common understanding of the FTR 2015 revised scope and implications before its effective date or else they risk disruptions to transaction flows.
Applicable from 26 June 2017, the regulation will broaden the required information – details relating to both the payer and payee – that must accompany transfer of funds involving at least one EU or EEA-based payment service provider (PSP). This will establish the means to better trace transfers of funds and help prevent, detect and investigate possible cases of money laundering and terrorist financing.
In April 2017, the European Supervisory Authorities (ESAs) issued draft guidelines and began a public consultation period. Both competent authorities as well as financial institutions must make every effort to comply with the final guidelines. Deutsche Bank’s whitepaper explains key requirements and open issues.
Among others, the whitepaper explains the manner of deciding whether to execute, reject or suspend transactions lacking the requirement information on payer and payee and under what circumstances a name-number check is necessary to verify the accuracy of payee information received by a PSP.
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