Verification of Payee (VoP)

What is it?

Verification of Payee (VoP), is a security process designed to confirm the identity of the recipient before carrying out a bank transfer.

How does it work?

The system checks that the beneficiary’s name and account number (IBAN) match the records held by the receiving bank. If there is any discrepancy, the user is notified and advised to review the details before proceeding with the transfer. In essence, it acts as a security filter aimed at preventing fraud and errors, ensuring that money reaches the correct person.

What are the benefits for users?

Prevents transfer errors by verifying details before sending money, avoiding transfers to incorrect accounts
Protects against fraud by detecting false information and warning about potential scams
Provides real-time alerts if the recipient’s details do not match, allowing timely corrections
Offers confidence and peace of mind by ensuring money is sent to the right recipient, making transfers more secure and transparent

What are the responsibilities of banks?

Integrate this verification service into their payment systems and keep it up to date
Alert users of any discrepancies before processing the transfer
Offer the service free of charge so customers are encouraged to use this security layer
Assume greater responsibility if Verification of Payee is not performed and fraud occurs due to money being sent to the wrong person. The bank may be held liable and required to reimburse the affected customer

When does it come into effect?

The regulation is already in force, but full implementation has specific deadlines:

Eurozone

Receiving instant payments: mandatory from January 2025
Sending payments with Verification of Payee: mandatory from October 2025
In Spain, this verification will be standard for all instant transfers by the end of 2025

EU countries outside the euro area

Receiving payments: from January 2027
Sending with verification: from July 2027

These are the deadlines set by the EU, but some banks may choose to implement the system earlier to enhance security and customer trust.

Glosario