UK banks have started to roll out their name-checking service for online bank transfers and payments made by cheque. This blog tells you everything you need to know about Confirmation of Payee (CoP) and how it affects you.
Details about the Confirmation of Payee (CoP) service were first announced last year and will be in full force by 2020.
Speaking about why the service is being introduced, chief executive of Pay.UK, Paul Horlock commented:
“Confirmation of Payee will let you check you have the correct name for the person or business you’re paying, giving better protection against certain types of fraud, and helping to stop accidental mistakes too.”
What is Confirmation of Payee?
Confirmation of Payee (CoP) is an account name-checking service which has been introduced by Pay.UK in order to give businesses and consumers reassurance that they’re sending payments to their intended recipient.
Name checking will provide an extra layer of security against the increasing number of cases of Authorised Push Payment fraud (APP) which cost UK consumers more than £145 million in the first half of 2018 alone.
Authorised push payment fraud is where someone tricks you into sending them money from your account. They often do this by contacting you via phone, email or social media and pretending to be someone else – such as your bank, a contractor, an estate agent or even the police.
How does Confirmation of Payee work?
With CoP, payment providers will check the name of the person or organisation given by the payer, against the actual name held on the account.
If the correct account name is used, the payer will receive confirmation that the details match and they can then proceed with the payment.
If a similar name to the account holder is used, the payer will be provided with the actual name of the account holder to check. This gives payers a chance to either update the payment details or check with the recipient before proceeding.
If the wrong name for the account holder is entered, the payer will be told the details do not match and they will be advised to contact the recipient.
The decision on whether to proceed with a payment will always rest with the customer. The risks will be made clear if they choose to go ahead after receiving a non-match.
What does this mean for you?
The account name for a payee has to be exactly correct for all payments (online and cheques). In our case for example, simply writing PKB isn’t enough. It has to be PKB Accountants Limited.
Consumers are being advised to find out a payee’s exact name before trying to process a payment. Cheques not written to the exact account name, will be rejected by banks. At the moment this doesn’t apply to Bacs payments, including direct debits but it’s good practice to ensure you’re using the correct name anyway.
If you’re ever unsure about making a payment or you feel something isn’t right, please contact the payee directly.
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