Breaking NewsEconomy

UK Adopts New Bank Transfer Rules to Curb Fraud

0

As part of efforts to help protect the finances of banking customers up and down the UK, bank transfer rules, brought in as part of a new law, are changing for millions of banking customers.

According to the Mirror, six of the UK’s major banks, including Barclays and HSBC, have introduced new security checks for all customers who transfer cash to friends, family, businesses and other payees.

The new system, known as ‘confirmation of payee’, was first introduced in October 2018 and becomes law on Tuesday, June 30.

It’s part of efforts to clamp down on fraud which costs the UK economy more than £130billion a year.

To make a transfer, you usually have to submit the recipient’s account number and sort code.

You can also send over their name, though in the past, banks haven’t been legally obliged to verify this.

This loophole enabled fraudsters to pose as other people to trick customers into sending money to other accounts.

But from June 30, you’ll be able to ask your bank to carry out a name check before sending out any money.

They’ll be able to check that the name on the account matches the name you’re sending money to – and if it doesn’t, they will notify you.

It means you can check who your cash is really going to, and stop the payment if necessary.

The June rules will apply to faster payments and CHAPS. Bacs payments, which are often used by employers to pay staff, will be added later in the year.

First Direct, Halifax, Lloyds, RBS (including NatWest), Nationwide and Santander will introduce it on June 30. TSB said it will follow by October 2020.

Importantly, you’ll only be able to request the safety check if both banks are on the scheme. It also won’t apply on international payments.

Confirmation of payee – and how it will work

To make a transfer after June 30, you will have to enter the payee’s sort code, account number and a payment reference as standard. You’ll also have the option to submit their name which will have to be exactly as it appears on the card.

Your bank will then ask you to enter the type of account you’re paying – personal or business.

It will then check the records of the payee’s bank account to see if the name matches.

You’ll then get one of the following responses:

  • If you used the right account name, you will get confirmation that the details match, and can go ahead with the payment
  • If you used a similar name to the account holder, you will be told the actual name of the account holder to check. You can update the details and try again, or contact the intended recipient to check the details
  • If you have entered the wrong name for the account holder you will be told the details do not match and advised to contact the person or organisation you are trying to pay.

If you’re doing a phone payment, you’ll be told whether it’s a match or not during the call. Online, you will be given a ‘yes, match’ notification.

The decision on whether to go ahead or not is still yours whatever happens – but the risks are made clear if you choose to go ahead after receiving a non-match.

 

 

JUST IN: Domestic Flight Operations to Resume July 8

Previous article

Early Signs of Alzheimer’s Disease Everyone Must Look Out For

Next article

You may also like

Comments

Leave a Reply