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The European Payments Council (EPC) has launched a public consultation on the Verification of Payee (VOP) Scheme Rulebook.
The public consultation is the first step in a process that will eventually deliver the EPC’s membership with a framework for fraud checks.
The VOP scheme will provide a set of inter-payment service provider (PSP) rules, practices and standards for the Single Euro Payments Area (SEPA), which will need to be complied with by participants who adhere to the scheme.
Further, it will set minimum conditions required in the payment service user (PSU) to PSP space and make use of ISO 20022 resource elements.
This proposed rulebook has been developed to support PSPs operating in SEPA to comply with legal obligations on the verification of a payee in the case of credit transfers as outlined in the EU’s Instant Payments Regulation (IPR).
Under the new rules, instant payment providers will need to verify that the beneficiary’s IBAN and name match to alert the payer to possible mistakes or fraud before a transaction is made. This requirement will apply to regular transfers too.
The proposed VOP scheme will allow PSPs to instantly send requests to verify the IBAN and the name of the payee as given by the payer and, if necessary, identification codes such as value added tax (VAT) numbers or social security codes.
Stakeholders now have until May 19 this year to respond to the consultation, which will ultimately need to be adhered to by the EPC’s 78-strong membership, which includes Mastercard, retail banks such as Santander and NatWest, and membership organisations such as the Electronic Money Association and the Open Finance Association.
From the end of May until August this year, the EPC has said it will be reviewing the feedback received from this public consultation.
The EPC subsequently aims to have the formal version 1.0 of the VOP Scheme Rulebook, the related VOP Scheme Inter-Payment Service Provider (PSP) Application Programming Interface (API) specifications, and the EPC recommendations for the matching processes under the VOP Scheme Rulebook ready by the end of September 2024.
The 2024 VOP Scheme Rulebook itself is expected to enter into force in September 2025.
