French banks to enforce name-checks on transfers

From 9th October, all French banks and payment institutions will be required to verify that the name of a payment recipient matches the IBAN provided before authorising a transfer. The move forms part of new EU legislation aimed at reducing fraud and operational errors across the Single Euro Payments Area.

The new rule, known as Verification of Payee, is part of the EU’s Instant Payments Regulation. It obliges banks to check whether the name entered by the payer matches the official name associated with the beneficiary’s account number. If the details do not match, a warning will be issued to the sender. Transfers may still proceed in some cases, but at the customer’s risk.

This verification mechanism has already been adopted in countries such as the United Kingdom and the Netherlands, where it has been shown to reduce incidents of fraud and misdirected payments. Its implementation in France marks a significant shift in standard banking practices.

Implications for account holders

Private individuals will need to ensure that names are entered exactly as registered with the recipient’s bank, including correct spelling and legal formats. For businesses, the requirement to use full legal entity names will be particularly important, as discrepancies may lead to delays or failed payments.

Although the change primarily targets fraudulent activity, it is also expected to reduce administrative burdens caused by incorrect or incomplete payment details.

A broader EU financial reform

The French Banking Federation has confirmed that all French banks must comply with the new regulation by the 9th October deadline. The rule applies to both standard and instant SEPA credit transfers and is part of a broader push to improve the safety and reliability of real-time payments across the eurozone.

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