The regulator wants to see Confirmation of Payee available to more people
The PSR also provides an update on APP scams
Today, the Payment Systems Regulator sets out its latest plans to fight fraud and protect victims of APP scams by outlining its next steps for the wider implementation of fraud prevention tool, Confirmation of Payee (CoP).
Every year thousands of individuals and businesses fall victim to Authorised Push Payment (APP) scams – where they are tricked into sending money to an account controlled by a fraudster. There are also a significant number of accidentally misdirected payments that are not recovered. The latest figures show that in the first half of 2021, £355 million was lost to APP scams, overtaking card fraud losses.
The PSR expects to see more action from financial institutions to stop these scams from happening and to better protect and reimburse people if they do fall victim.
Confirmation of Payee
Confirmation of Payee (CoP) is designed to reduce certain types of accidentally misdirected payments and APP fraud in bank transfers by checking the name on the recipient’s account matches the details a payer has given to their bank. The name check tells payers whether there is a match or not. This means people can more easily spot when something isn’t right.
This has been a key way to stop certain types of APP frauds and accidentally misdirected payments from happening and is why the PSR directed the UK’s six largest banking groups to introduce CoP over FPS and CHAPS transactions, with several other institutions having signed up to offer the service since it was introduced in 2020. There are now more than one million CoP requests every day.
Earlier this year, the PSR set out to understand the impact of the introduction of CoP Phase 1 by the directed banks and assess what the next steps should be to bring this service to more financial institutions and their customers.
In today’s publication, the regulator:
- sets out the industry's commitment to deliver Phase 2 and stands ready to step in if there is a delay in delivering the capabilities; and
- confirms its plan to direct the necessary system developments to enable the transition of current CoP participants from Phase 1 to Phase 2. This is key as making sure that the current providers of CoP transition to Phase 2 is a significant driver to the success of wider implementation by more institutions from the end of 2021.