LUXHUB launches Payee Verification Platform

Even if the deadline for implementation appears distant, regulatory bodies encourage PSPs to initiate their compliance projects to meet the timeframe, with LUXHUB’s shareholders supporting the development of the Payee Verification Platform and assisting with the company’s commitment to providing an enhanced solution designed to meet the requirements of all PSPs.

The VoP mandate is set to improve the banking experience for customers by requiring the verification of the recipient’s name against the International Bank Account Number (IBAN) before a credit transfer is authorised. This initiative aims to reduce errors and prevent fraud by ensuring that payments are sent to the intended recipient. Additionally, except for those conducting bulk payments, clients are set not to have the option to refuse this verification service.

Furthermore, when a transaction is authorised even if a discrepancy between the payee’s details exists and the PSP meets all regulatory requirements, the latter is set to not be liable if funds are sent to an unintended beneficiary. Yet, liability may be assigned to either the payer’s or the payee’s PSP if the verification service fails or delivers faulty information. According to LUXHUB’s officials, the initiative is set to positively impact the payment journey of bank customers by allowing safer transactions via an immediate IBAN-name check verification.

By adopting VoP, PSPs are required to enable the reception and processing of instant payments within nine and 18 months after the publication of the Instant Payments Regulation. The initiative’s capabilities are underlined by its potential to increase security and trust in payments, considering the expansion of instant payments. Moreover, the success of VoP depends on a simplified and consistent user experience, needing early customer education and gradual system deployment to support acceptance and integration into regular payment practices.

By utilising its insight into API and data management, LUXHUB has been working on developing the VoP platform for over a year. The company intends to simplify access to VoP for its clients by being the central point of contact, leveraging its experience in Payment Services Directive 2 (PSD2) aggregation and connectivity within the EU. The strategic positioning is set to allow LUXHUB to provide efficient connectivity solutions to PSPs, assisting compliance with regulatory requirements. Currently, LUXHUB serves over 80 clients across more than 10 European countries, delivering several compliance services and solutions in account aggregation and payment initiation.

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