New requirement to verify payees for credit transfers
Many people will have already noticed the so-called mandatory verification of payees for credit transfers, which started recently. The aim of this is to enhance security for payment transactions, but it requires diligence when updating payment details.
A new Regulation (EU) 2024/886 came into force on 9.10.2025; this will either noticeably change payment transactions in companies, or it has already done so. This is because, for credit transfers within the SEPA area, the name of the payee must now be matched with the related IBAN (so-called “Verification of Payee“, abbreviated to VoP). For every credit transfer the bank will check if the name and IBAN match. If there is a discrepancy a message will appear, or the credit transfer will be blocked. The aim is to prevent fraud attempts via forged payee details.
Companies that regularly make credit transfers - for example, to suppliers or service providers -, are directly affected by this. We would recommend the following measures for them:
- Check the payment master data - Review the payee data stored in the accounting software at regular intervals. The name and IBAN should exactly match the payee’s bank details.
- Raise awareness among employees - Send a note to the finance department and responsible staff members referring to the new verification requirement, in particular, to the possible system feedback, such as, “Name does not match”.
- Adjust payment processes - Build a sufficient buffer into your time schedule for credit transfers. Queries or necessary corrections could delay the payment flow.
- Create the technical prerequisites - Ensure that the accounting or banking software supports VoP.
- Inform customers - Information for customers about the changes so that they will be aware and non-payment and payment delays will be avoided.
