Changes to the information that we provide when making a bank payment or transfer are coming to the UK next summer.
Bank payments will require the account holders name in addition to the existing requirements of account number and sort-code, in an attempt to combat fraud.
At present, anyone wanting to transfer money enters the intended recipient’s name, account number and sort code. However, the name is not checked or validated against the name of the account holder.
Under plans from the UK’s payments operator, the sender will be alerted if the name does not match the account.
It is designed to combat cases when fraudsters mimic a genuine business and attempt to trick people into sending money to an account controlled by the con-artist.
Details of how the “confirmation of payee” system will work have been revealed by Pay.UK – the operator which oversees the UK’s major payments systems.
How Confirmation of Payee will work
When setting up a new payment, or amending an existing one, banks will be able to check the name on the account of the person or organisation you are paying.
- If you use the correct account name, you will receive confirmation that the details match, and can proceed with the payment
- If you use a similar name to the account holder, you will be provided with the actual name of the account holder to check. You can update the details and try again, or contact the intended recipient to check the details
- If you enter the wrong name for the account holder you will be told the details do not match and advised to contact the person or organisation you are trying to pay
Confirmation of Payee has the potential to impact timely payments to suppliers unless companies clearly state their account name on their invoices. – Vicki Longmore, MD Starbooks Ltd
Tricked out of millions
The aim is to cut down on so-called authorised push payment (APP) scams, in which people are conned into sending money to another account.
A total of £145m was stolen from bank customers in this way in the first half of the year, with many victims unable to get the money back because current legislation means they are liable for any losses incurred if they authorise a payment themselves.