Consultation CP22/2 on further Confirmation of Payee participation closed

The Payment Systems Regulator (PSR) consultation CP22/2 on requirements for further participation in Confirmation of Payee closed on 8 July 2022, and the regulator published its response¹. The consultation set out proposals to direct approximately 400 payment service providers (PSPs) to implement a system offering Confirmation of Payee (CoP) to their customers, both as payers and payees¹.

CoP checks whether the name of a payee's account matches the name and account details a payer provides, and was designed to help stop some types of authorised push payment (APP) fraud and accidentally misdirected payments¹. The PSR issued Specific Direction 10 (SD10) in August 2019 to the six largest banking groups, requiring them to send and respond to CoP requests¹. At that time the directed banks covered around 90% of transactions made via Faster Payments and CHAPS¹. Since then, a number of non-directed PSPs have joined voluntarily, so that 33 PSPs now offer the CoP service¹.

The proposed direction would apply in two groups, with different deadlines¹:

The PSR said the first group would see CoP coverage rise from 92% of transactions made via Faster Payments to 99%¹. The regulator described the proposals as a continuation of the work begun with SD10 and as its ambition to see widespread adoption of CoP by more PSPs, with more payment system users benefiting from its protection¹.

Why it matters for households

Confirmation of Payee is the check that warns a payer when the name they give does not match the account details held by the receiving bank. Under the proposals, customers of the roughly 400 PSPs named for direction would gain that check when sending and receiving payments, rather than only customers of the firms already offering it¹. The change would be staged: firms in the first group would need CoP in place by 30 June 2023, and the second group by 30 June 2024¹. Until a customer's own provider implements the service, that customer's payments would not carry the CoP warning, even where the receiving firm is covered. The PSR links wider CoP adoption to preventing APP scams, in which a payer is tricked into sending money to an account they believe belongs to someone else¹.

What happens next

The consultation closed on 8 July 2022 and the PSR published its response¹. The deadlines set out in the consultation are 30 June 2023 for the first group and 30 June 2024 for the second group¹. The PSR has not reported, in this material, the final list of firms covered by any direction or the final terms of that direction.