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Name Checks To Accompany Bank Payments - PYMNTS com in the United Kingdom

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    With an eye on fraud prevention, banks in the United Kingdom are slated to debut name checks to accompany bank transfers. The directive comes from Pay.UK, the U.K. payment authority.

    As noted by Financial Times and other sources, the movement, which is one known as “confirmation of payee,” will take effect in 2019. The process is one where those sending money must enter the account number and the code of the recipient. The company or the individual tied to that receiving account will be verified before money changes hands. A mismatch will warn would-be senders about risks tied to sending money to those accounts. Conversely, should the names indeed match, confirmations are given to the sender and the transaction can be completed.

    FT noted that such efforts will help cut down on what is known as authorized push payment fraud, which has cost 145 million pounds in the first half of 2018. As has been noted, money has been siphoned off from transactions and diverted to accounts that appear to be held by legitimate parties.

    Beyond the two options mentioned, if a name “similar” to the one held in actuality is entered, the actual holder’s name will be displayed, and the banking customer can then re-enter those details or contact the other party for confirmation.

    “Sending a payment with an incorrect sort code or account number is like addressing a letter with the wrong postcode,” Paul Horlock, chief executive of Pay.UK was quoted by FT as stating. “Even if you have used the correct name, it won’t reach the intended destination — and fraudsters have become increasingly sophisticated in using this to trick people.”

    Under current practice, names are not checked during money transfers. And in reference to the fraud perpetrated against the unwitting people and organizations sending funds, BBC noted that the victims are unable to get funds back, as legislation that is in place means they are liable for losses on authorized payments.

    See More In: ank transfers, authentication, authorization, bank security, Fraud Prevention, identity check, News, payment confirmation, Payment Security, payment verification, UK payments


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