Verification of payee for transfers – what applies
Since 9 October 2025 all credit institutions have been obliged to carry out a verification of the payee for transfers – known as the IBAN name check or Verification of Payee (VoP). The change increases security in payments and reduces mistaken transfers and attempted fraud. For companies it also affects salary payments: the name held for an employee has to match the account.
What it is about
Previously the payee name entered was not compared with the name held for the IBAN. Under the EU regulation the bank now checks, before release, whether the name entered matches the payee’s account details. The result is shown to the person making the transfer – they decide whether to release the payment or cancel it.
Which transfers are affected
The check applies to instant payments and to ordinary euro transfers within the euro area – exclusively from current account to current account. Savings and loan accounts are excluded. Both electronic and paper-based transfers are subject to the check; for paper orders it only happens when the order is handed in personally at a branch. Existing standing orders continue without a check – only changes or new standing orders trigger it. Direct debits are not affected.
The three possible responses
- Details match – the transfer can be carried out without restriction.
- Details are similar but not identical – the actual account name is shown; check the entry, correct it or release it deliberately.
- Details differ clearly – an indication of possible risk; cancel, correct or deliberately continue.
For paper-based transfers, bank staff communicate the result directly.
Who is liable
If a transfer is carried out to the wrong person despite a correctly performed verification of payee, the bank is not liable for the loss. If the institution carries out no check at all and a faulty payment results, it must refund the amount.
What to watch out for when transferring
- Ask your bank about the verification of payee.
- On invoices and payment requests, check the exact payee name.
- Enter that name precisely in the transfer form.
- Check the result of the comparison carefully before releasing the payment.
And one thing still holds: responsibility for the transfer lies with the person ordering it – once confirmed, an order can generally no longer be revoked. For payroll accounting that means keeping master data clean, so that salary payments do not get stuck on a mismatched name.