A rise in digitisation calls for a demand for security, speed and efficiency of digital payment which is why the European Payment Council (EPC) has taken a significant step by including the new guidelines for their Verification of Payee (VOP) scheme.
The guide mandates the rules and procedures to be followed by participants of the verification of payee in the Single Payments Euro Area (SEPA).
The VoP Scheme establishes a set of rules, practices and standards for verification of payee name. The objectives are to automate VoP requests and responses, improve integration across, increase security and create a competitive market for payment services.
Rules and Regulations from the VOP Rulebook
Ensuring Verification of Payee Services:
An important factor mentioned under the new guidelines is for Payment Service Providers (PSPs) to provide a service that ensures payee verification before the fund transfer is executed. This means that the functionality must be provided directly after the payer inputs the payee data and before they can authorise the transfer.
Details on the Process of Verification:
The rulebook outlines a set of procedures required for the process of verification:
- Verifying information of the Payment Account and Payee name: When the payer enters the payee’s account details and name, the PSP of the payer is to see that the details match accurately. If the result of name-matching is a no-match, the payer PSP is to alert the payer that the payment may result in the funds being sent to the incorrect account holder. On the other hand, if the details are a close match, the PSP should indicate the right name associated with the account.
- Unique Identifiers for Legal Entities: In the case of legal actors, the guidelines allow for the use of additional unique identifiers (for example a Legal Entity Identifier, fiscal number, or a European unique identifier) to be provided for verification. The Requesting PSP must run checks on the identifiers with the payee’s PSP data.
- Multiple Payees that Hold an Account: When a payment account is held by multiple payees, the payer may provide additional information to identify the correct payee the funds are to be credited. Then, the payer’s PSP must verify the details to confirm if the payee is associated with the account and any mismatches should be reported back to the payer.
PISPs Must Verify the Information:
The payment initiation service provider is responsible for ensuring that the information concerning the payee is accurate. Both PSP and PISP are responsible for maintaining robust internal procedures to verify payee details, ensuring there is no misdirection of the payment.
Payments done under Traditional Methods:
To execute payment orders that are paper-based, verification must be executed when the receipt is generated. However, this can be exempted if the payer is not present. Hence, ensuring that even continued practice of traditional payment initiation methods are also secured and go through the same standards of verification.
Non-Consumer PSUs that wish to Opt-Out:
PSUs that are non-consumers can opt out of the verification service even if they have submitted multiple payment orders as a package. However, the PSPs must inform them of the potential implications of doing so and its impact on PSP liability and refunds. They also have the option to get back into the service at any time.
Deadline for PSPs to begin Implementing the Scheme:
The documents published specify that all PSPs located in the Euro-denominated member states must abide by the rules of verification by October 9, 2025. Enough time has been given to PSPs to start implementing the system to carry out procedures matching the new guidelines.
Verification of Payee (VoP) in Europe Under the EPC Framework
Verification of Payee (VoP) in Europe is governed by the European Payments Council (EPC) under the SEPA-wide VoP Scheme. As part of the Instant Payment Regulation (IPR), financial institutions across the European Union are required to implement VoP to reduce fraud, prevent misdirected payments, and enhance trust in instant credit transfers.
Under the EPC framework, VoP enables the payer to verify whether the beneficiary’s name matches the IBAN before a transaction is executed. This is particularly critical in real-time payment environments where funds are transferred instantly and cannot be easily recalled.
The EPC VoP scheme introduces a structured ecosystem involving:
- Requesting PSPs (VoP Requesters) – Initiate name-check requests
- Responding PSPs (VoP Responders) – Validate and respond with match status
- Routing & Verification Mechanisms (RVMs) – Facilitate secure and standardised message exchange between participants
With over 5,000+ financial institutions across SEPA required to align with VoP obligations under IPR deadlines, compliance is no longer optional. Institutions must ensure that their VoP implementation aligns with EPC technical specifications, interoperability standards, and cross-border routing requirements.
For PSPs operating in Europe, selecting an EPC-compliant VoP infrastructure is essential to meet regulatory timelines while maintaining operational efficiency.
Choosing a Verification of Payee Provider in Europe
As the VoP mandate becomes effective under the Instant Payment Regulation, financial institutions must carefully evaluate their approach to implementation. Selecting the right Verification of Payee provider in Europe is critical to ensuring regulatory compliance, scalability, and seamless integration.
When assessing VoP providers, institutions should consider:
EPC Registration & Scheme Alignment
Ensure the provider operates within the EPC VoP Scheme framework and supports Routing & Verification Mechanism (RVM) capabilities where required.
Cross-Border SEPA Coverage
The solution should enable VoP checks across multiple European markets, supporting interoperability between SEPA participants.
API Integration Simplicity
A single, standardised API reduces technical complexity and accelerates deployment timelines — particularly important for institutions preparing for IPR compliance deadlines.
Fraud Prevention & Operational Efficiency
Beyond compliance, the VoP solution should reduce APP fraud risk, prevent payment errors, and minimise operational overhead.
Scalability & Future Readiness
With instant payments growing rapidly across Europe, VoP infrastructure must handle increasing transaction volumes while remaining aligned with evolving EPC guidelines.
Institutions that adopt a compliant, scalable, and API-driven VoP solution will be better positioned to meet regulatory requirements while strengthening fraud prevention in real-time payment ecosystems.
To Conclude
All participants adopting the Verification of Payee scheme have now been provided with a clear framework in the EU Regulations (EU) 2024/886 to adhere to. It is essential to preserve the integrity and dependability of the VoP service throughout SEPA.
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