Instant Money Transactions and Verification of Recipients Now Available in Banking Sector
In the ever-evolving world of financial transactions, a new measure is being implemented across Europe to enhance security and prevent fraud. The European Consumer Centre (EVZ) advises consumers to be vigilant when using real-time transfers, especially when the recipient is not clearly known.
Beginning October 9th, banks across Europe will enable sending real-time transfers in addition to receiving them. These transfers, which can be completed in seconds and are available 365 days a year, should not be more expensive than traditional SEPA transfers. However, it's essential to note that real-time transfers are practically impossible to stop once confirmed.
To ensure a secure transaction, banks use a traffic light system for the recipient check: green for a match, yellow for minor discrepancies, and red for no match. If discrepancies arise, banks will display them to the customer for approval. The recipient check does not protect against all fraud schemes, such as identity theft, but it is designed to make incorrect transfers and fraud attempts more difficult.
Initially, banks are only required to perform a recipient check for euro transfers. From July 9, 2027, the obligation will apply to transfers in other currencies as well. Interestingly, the United Kingdom and Switzerland do not belong to the European Economic Area and will not perform recipient checks, making transfers to these countries riskier.
The recipient check applies to both real-time and SEPA transfers. The EVZ also advises consumers not to ignore warning notices from their bank. They should carefully review any discrepancies and consider whether the transaction is legitimate before approving it.
It's worth mentioning that the recipient check is free of charge. However, it's essential to note that with classic SEPA transfers, it is sometimes possible to recall the money, but this is almost impossible with instant payments.
In conclusion, while real-time transfers offer convenience and speed, they also come with increased risks. Consumers are advised to exercise caution and only use real-time transfers when the recipient is clearly known. By adhering to these guidelines, consumers can enjoy the benefits of real-time transfers while minimising the risk of fraud.
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