If you make payments using a high-street bank app or online, you’ll probably have noticed that you’ve been asked to confirm the name of the person you’re paying money to.
This is to allow you to check that the account details you have entered definitely belong to the right person. This service is called Confirmation of Payee (CoP), and has been rolled out by all the major banks over the past few years.
Now, all organisations who originate payments are expected to implement CoP before the 31st October 2024.
How does CoP apply to Credit Unions?
Outbound payments - withdrawals from share accounts:
Members will be asked to confirm the name of the external payee they are sending payments to
This functionality will be added to Members Area / Mobile App over the coming months - you don’t need to do anything and we’ll provide a full timeline soon
This check confirms that the payer knows the name of the person they are paying, and that the account they are paying to belongs to that person
If they get the name correct (or very close), they will receive confirmation on-screen
If they get the name wrong, they will receive an alert to say that the account details can’t be matched, followed by a warning about scam payments
By asking members to confirm that they wish to proceed, even if the account details are different, they will be accepting liability that the payment may be being made to the wrong account.
We will add functionality, post-October 31st, to give you the option to block payments where the details don’t match.
Inbound payments - payments to repay loans:
Accounts used solely to accept incoming loan repayments are exempt from CoP
Inbound payments - payments into share accounts:
People paying a member of your Credit Union will have to provide the details of the Credit Union, not the member, otherwise the details won’t match
Your existing bank will already provide this service, so there is no action to be taken to support this
Virtual Accounts:
We are introducing “Virtual Accounts” (through ClearBank) which will allow you to provide an account number and sort-code to each member, in their own name
Incoming payments can be automatically matched with existing member numbers, enabling realtime, automated reconciliation