Verification of Payee: Insights from Go-Live. Learnings from Deutsche Bank
The European Payments Council spoke with Jose-M (Chema) Buey, Director and Global Head of Client Account Services at Deutsche Bank’s Corporate Bank, about the industry-wide go-live of Verification of Payee (VOP), the key technical and operational challenges encountered during implementation, and the early impact of VOP on payment security, customer experience, and the adoption of instant payments across Single Euro Payments Area (SEPA).
The VOP go-live on October 9th was a significant industry achievement, successfully rolling out a new infrastructure across over 3,000 Payment Service Providers (PSPs) and Routing and/or Verification Mechanisms (RVMs) in a „big bang” approach.
Initial challenges included cross-RVMs connectivity issues ensuring seamless communication between different RVMs as well as incomplete or incorrect EPC Directory Service (EDS) setups where a proper configuration was crucial. Despite these, most participating PSPs and RVMs went successfully live before the regulatory deadline with minimal client impact.
„Over the last three months, we have observed a gradual reduction in connectivity errors and VOP NOAP (Not Applicable) responses. However, it is still too early to assess meaningful numbers regarding a reduction in payment fraud.” – said Jose-M (Chema) Buey.
To make the VOP scheme more effective and user-friendly, particularly for corporate clients, the Deutsche Bank representative said that further clarification and pan-European standardisation are probably needed in three key areas:
- Standardise VOP-In/VOP-Out indication: Implement a consistent method, such as a specific indicator in the incoming PAIN.001 message, to clearly denote whether a payment file is subject to VOP-In or VOP-Out.
- Increase flexibility for automatic processing: Allow for more flexible rules on how VOP-In payment files are automatically processed based on VOP results (e.g., automatically processing all „Match” response payments without manual intervention).
- Ensure full delivery of VOP Pain.002 response: Guarantee the complete delivery of the standard VOP Pain.002 response file to the original client payment channel, with eventual integration into client ERP/TMS systems.
More details here
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