Verification of Payee: strengthening trust in the age of instant fraud

Authorised push payment scams: when the transfer is legitimate, but the intent is not

The EPC Payments Threats and Fraud Trends Report highlights that one of the fastest-growing fraud patterns in Europe is authorised push payment (APP) fraud.

These schemes rely on manipulation rather than intrusion:

• impersonation of banks or payment providers
• invoice redirection
• social engineering targeting individuals and corporates
• scams that manipulate the payer into authorising the payment

In this model, the payment instruction is technically valid, but the transaction is fraudulently induced.

The joint EBA/ECB fraud report confirms this shift, noting that manipulation of the payer now represents the majority of fraudulent credit transfers in value terms across the EU.

Verification of Payee: prevention embedded into the payment journey

Against this backdrop, Verification of Payee (VoP) is emerging as one of the most important fraud mitigation tools in Europe.

Its purpose is straightforward: ensuring that the name of the payee matches the account identifier before a transfer is executed.

VoP introduces a frictionless but decisive checkpoint:

• reducing misdirected transfers
• limiting impersonation-based fraud
• strengthening trust in account-to-account payments

As instant payments continue to scale, such upstream verification mechanisms become essential.

A regulatory and operational turning point for PSPs

VoP is also central to the evolving European payments framework.

Under PSD3 and the forthcoming Payment Services Regulation, expectations around fraud prevention and shared responsibility are being reinforced.

Payment service providers are increasingly expected to deploy:

• proactive fraud controls
• stronger authentication and verification layers
• structured reimbursement frameworks
• coordinated sector-wide responses

Fraud prevention is no longer treated as an ancillary function, but as a core component of payment system integrity.

AI and verification: complementary layers, not substitutes

While our previous article explored how AI is becoming indispensable in real-time fraud detection, verification tools like VoP address a different dimension:

• AI detects anomalies and intent signals dynamically
• VoP prevents errors and deception structurally at initiation stage

The AI in Action global survey shows that the industry is rapidly deploying advanced AI, but also highlights that trust and governance remain constraints.

VoP represents a more deterministic trust mechanism, complementing AI-driven orchestration.

Together, these approaches reflect the direction of travel: layered prevention, not single-point solutions.

Trust, interoperability and the next European payment phase

Europe is moving towards a more integrated payment ecosystem, where trust frameworks must evolve at the same speed as innovation.

This is particularly relevant as Luxembourg prepares for the rollout of Wero, the European digital wallet expected from July 2026. 

As ABBL has underlined in its analysis of the diversified payments ecosystem and the growth of PI/EMI actors, innovation will depend not only on speed and usability, but on trusted execution and fraud resilience.

ABBL continues to support structured cooperation across banks, fintechs and payment infrastructures, notably through initiatives such as the
ABBL Bank CEOs–FinTechs Speed Meeting 2026.