Confirmation of Payee Progress and App Fraud Mitigation: Where Are We Now?

Introduction:

This report compares Confirmation of Payee progress and APP fraud mitigation across EMEA, APAC and North America, and features expert commentary from AccessPay, Bottomline, Finastra and NatWest. When a payment instruction is created for a company or by an individual, the bank account name, sort code, account number and the beneficiary’s name is required.

While it is assumed that this identifying information is checked before the payment goes through, today, this assumption is not sufficient. That’s because the type of payment scam where people are contacted by fraudsters and asked to transfer funds to a new account in their name – known as Authorised Push Payment (APP) fraud – is prevalent and growing. Using the UK as the blueprint for success, the 2015 Pay.UK report on enhancing the payments experience drew a line in the sand and outlined a path forward for improvement and innovation across payment infrastructure.

At the time, a key action for Pay.UK was to establish a three-way match between the beneficiary name, sort code and bank account number. Beyond the benefits for fraud mitigation, this also decreased the chances of funds being sent to the wrong individual or organisation and hoping that the money would be repaid. Confirmation of Payee (CoP) – as an idea – was born. For individuals and companies setting up new payees and payments, the aim was for payment providers to be able to confirm the name provided with the account name.

Highlights from the Bottomline experts across the world:

EMEA

The "landscape of payment fraud prevention in the EMEA region is rapidly evolving. Significant strides are being made in the implementation of pre-verification tools like Confirmation of Payee (CoP) and Verification of Payee (VoP)" - Erez Nounou, Product Lead Risk Solutions Bottomline

APAC

Eli Shoshani, head of APAC, Bottomline, calls upon the industry to consider “the implementation of payment verification mechanisms in APAC. The landscape of payment fraud prevention is marked by significant efforts to enhance verification mechanisms, both for domestic and international transactions.

North America

Eric Choltus, Director of Global Product Management, Bottomline says "there is no one-size-fits-all approach to solving this for financial institutions and effective strategies often involve the institutions’ ability to leverage various third-party vendors into a cohesive fraud prevention and payee verification strategy."

Read the report for full details.