Concepts
Verification of Payee
Verification of Payee (VoP) is designed to help prevent fraud and misdirected payments by confirming that the intended recipient’s name matches the name registered on the account before a payment is made. VoP is required by the SEPA Instant Payment Regulation to enhance security in the payment ecosystem.
The VoP process typically involves the following steps:
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Before the payment is processed, the payer’s bank sends a verification request to the payee’s bank
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The payee’s bank checks if the provided name matches the name on the account
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The payee’s bank responds with a match status (match, close match, or no match)
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Based on the response, the payer can decide whether to proceed with the payment
This approach helps reduce the risk of payments being sent to incorrect or fraudulent accounts, providing an additional layer of security for financial transactions.
Verification of Payee Requester Service
A VoP Requester Service is an implementation that enables financial institutions to send VoP requests. It acts as the requester component in the VoP flow, receiving verification requests from a Processing Entity and forwarding requests to the relevant Scheme for Name Matching.
Core Components
The VoP Requester Service relies on several external services to determine the verification outcome:
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IBAN Deconstruct - Provides the capability to deconstruct an IBAN to determine the relevant party agent BIC if not supplied in the request
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VoP Responder - Either direct to a Scheme or via a RVM the VoP Responder will return the match result.
Error Handling
The VoP Requester Service handles errors commonly, which follow the following pattern:
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Log error or warning message to logs utilising Context Propagation to match requests to log lines
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Output Message Logs for each call to an external service to track requests and responses
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Respond with a relevant HTTP status code and description indicating the reason for error