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International payment network Swift working on ‘Verification of Payee’ scheme integration in EU

Fintech and banking

Jul 2, 2024

4 min. read

James Irwin

Author

Swift recently conducted research on Verification of Payee (VoP) schemes, instant payments, and related regulations. It found positive sentiments among survey respondents and is currently working to integrate VoP schemes across the EU.

Key takeaways

83% of Swift survey respondents believe upfront beneficiary checks are important
New regulations require payment service providers (PSPs) to perform Verification of Payee (VoP) checks in the EU’s SEPA area by 2025
Many countries already use VoP checks within their own borders, but greater cross-border interoperability between schemes is still needed
PSPs must also support sending and receiving instant transactions 24/7

Report Shows Support for Instant Payments Among SMEs

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Swift, the leading bank-to-bank payment messaging network, recently published findings on the EU’s Instant Payments Regulation (IPR) and said it will provide related support.

A June 18 report from Swift indicates that 83% of queried decision makers at small and medium enterprises (SMEs) in France, Germany, Italy and Spain believe upfront beneficiary checking — or confirmation of recipient details — is important.

The respondents also expressed positive sentiments toward instant payments more broadly. Nearly 90% of respondents expect to be impacted by the regulation. Meanwhile, 44% expect the new regulation to help them save money, 27% expect the change to improve their cash flow, and 20% expect it to make their company more competitive.

Swift said elsewhere that instant payments offer “real and tangible” benefits because they give buyers more time to pay invoices and help sellers make shipments faster.

Both factors will help improve business flows and help reduce delays, per the release.

Compliance due October 2025

Instant Payments Regulation (IPR) means that payment service providers (PSPs) must allow customers to send and receive transactions within ten seconds on a 24/7 basis domestically and throughout the EU, according to the European Council.

Swift separately noted that PSPs must perform Verification of Payee (VoP) checks for cross-border payments within the Single European Payment Area (SEPA).

It noted that regulation came into force in April 2024 but said that companies must comply with the VoP rules by an October 2025 deadline.

Swift observed shortcomings in both instant payments and VoP. It said that although many countries already use Verification of Payee (VoP) checks within their own borders, interoperability between schemes internationally is still necessary.

The network noted that instant credit transfers make up less than 13% of the total transfers across Europe. New regulation aims to improve the payments ecosystem.

Swift’s VoP role

Swift said it aims to facilitate interoperability of Verification of Payee (VoP) schemes for its own community through its Payment Pre-Validation solution.

The service will help financial institutions comply with regulation through their existing Swift connectivity while guaranteeing secure standard financial data transmission.

Marianne Demarchi, Chief Executive for Europe, the Middle East, and Africa at Swift, emphasized the company’s key role in the initiative. She said Swift is “ideally-placed at the heart of the industry” to build interoperability of VoP schemes. She also called the new regulation a “landmark development for the cross-border payments industry.”

Swift aims to transform early adoption into more widespread use.

So far, at least two VoP providers — CBI and SurePay — have expanded their reach across Europe in cooperation with Swift.

A UK multi-currency account can streamline how you manage your finances. Whether for business or personal use, a multi-currency account provides you with added freedom and flexibility and removes barriers to payments and transfer methods.

Here is everything you need to know about UK multi-currency accounts.

A Payset UK multi-currency account is a single account with which you can hold, send, and receive funds in up to 38 currencies. This allows business or personal account holders to save endless time and money on foreign exchange, and money transfers, which from a traditional bank account would be far more expensive and slow.

From your personal UK-based IBAN account, you can transfer money to bank accounts around the world as well as send and receive free and instant transfers to and from other Payset clients. You can send funds using a diverse network of payment networks, including SWIFT, SEPA, Target2, Faster Payments, CHAPS, and more.

When you exchange funds from one currency to another, there are no margins added to our exchange rates and the fees are clearly displayed before you click send. If you, for example, work with multiple currencies, make purchases in other countries, travel frequently, invest in foreign currencies, pay staff in other countries, or receive payments in other currencies, a multi-currency account can save you time, money, and work compared to a traditional bank account.

There are lots of banking institutions and financial services that will aid you in opening a multi-currency account. Often they can allow you to convert and transfer a considerable number of currencies.

Before you open a UK multi-currency account with any platform or service, make sure you have explored all of the different options available to you and have found the best type of account to suit your financial needs.

How Does a UK Multi-Currency Account Work?

A UK multi-currency account works in the same way as a standard bank account or electronic wallet. Although the services provided will change depending on where you choose to open your account and who you choose to open the account with, all multi-currency accounts should allow you to:

Withdraw money

Send and receive payments in multiple currencies internationally

Access your funds for electronic transfers

Earn interest on your account total

In the same way that fees can occur with a standard bank account you may run into additional charges with a UK multi-currency account.

You could be charged for a number of actions including; making withdrawals, account opening and closure fees, transfer fees, and more.

The frequency or amount of these charges will often vary and if you ask your banking agency they will usually be able to tell you exactly how much you will be charged and which services you will be charged for before you open your account.

Alternative Options to Consider Before Opening a UK Multi-Currency Account

There are many alternatives to opening a UK multi-currency account. For example, there are also money transfer services and online electronic wallets such as Payset that allow you to send your money in over 34 currencies without the need for a UK multi-currency account. You can start sending money across the globe or in person today using your existing bank account.

Frequently asked questions

What is a UK multi-currency account/IBAN?

Are there limits to the amount of money I can send and receive with a UK multi currency account?

Which currencies can I send and receive in my UK multi currency account?

How do I add money to my UK multi currency account?

Types of UK Multi-Currency Accounts

Multi-currency IBAN accounts
Personal multi-currency accounts
Multi-currency accounts for business
Multi-currency cash passports
Multi-currency wallets

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