Europe’s Payee Checks Set the Pace as US Plans Take Shape

A payment moving from one country to another passes through banks, clearing systems and payment networks that operate under different rules. The recipient information used to check the payment and bolster security can be just as fragmented.

Payee verification connects some of those far-flung systems. Banks and payment providers are placing account and beneficiary checks inside payment workflows and extending them across markets, creating ways to establish whether an account and intended recipient match before an instant or cross-border payment is released.

Last month, IPID announced a $16 million Series A funding round led by Foundation Capital, with Citi and HSBC participating. The company said its account verification network supports financial institutions in more than 50 countries. It plans to use the funding partly for expansion in the United States and Europe and for capabilities covering U.S. payment rails and digital assets.

The round followed a series of moves across the payments industry to place recipient verification closer to payment initiation.

In August, Open Payments integrated Verification of Payee into its API, allowing payments originating in ERP, accounting and treasury systems to check the intended recipient before execution.

Also in August, MassPay launched MassPay Validate to check account status and ownership before a payment is originated, while commercial insurance FinTech Diesta integrated JPMorgan’s Kinexys Liink Confirm so brokers, managing general agents and insurers can verify beneficiary account details within their payment workflow.

The common function is one where systems compare information about the intended recipient with information associated with the destination account, while a payment can still be reviewed or corrected.

Payee verification has developed differently across major payment markets.

In Europe, the Instant Payments Regulation requires payment service providers to offer Verification of Payee for standard and instant euro credit transfers. The service tells the payer whether the account identifier and intended payee produce a match, close match, no match or another result before the payment is initiated. The requirement took effect for covered PSPs in euro area member states in October 2025.

The U.S. is developing its own capabilities. The Federal Reserve already offers Payee Name Verification, a payment-rail-agnostic service that lets participating financial institutions check an intended payee’s name against routing and account information before issuing a payment. The Fed plans to make payee-name verification available to FedNow® Service users through an API as an upcoming enhancement to the instant payment service, PYMNTS reported in July.

Cross-border payments require those capabilities to work across markets. A bank initiating a payment may need to reach recipient information held by another institution or available through another country’s verification scheme. The infrastructure must route the query, identify the appropriate source and return information that can be used in the originating bank’s payment process.

The PYMNTS Intelligence report “Payment Protection: Why Firms Still Aren’t Real-Time Ready” found in August that 60% of firms using real-time account ownership verification detected suspected fraud instantly or within minutes, compared with 39% of firms that didn’t use real-time ownership verification. Real-time verifiers were also more than twice as likely to detect suspected fraud before money moved, at 21% versus 10%.

Meanwhile, the PYMNTS Intelligence Tracker “When Fraud Becomes the Customer: The Next Battlefront for Issuers” found in September that unauthorized-party schemes accounted for 71% of fraud incidents and dollar losses in 2025, up from 48% the previous year. Credential theft and account takeover can allow criminals to impersonate legitimate customers before fraudulent payments are attempted.

Payee verification covers the destination, another part of the transaction. An authenticated customer can still enter incorrect account information or be persuaded by a scammer to send money to an account the criminal controls.

From Local Systems to Cross-Border Infrastructure

Connecting verification services becomes more useful as a payment moves through markets with different account formats, identifiers and verification arrangements.

The architecture taking shape doesn’t depend on every country adopting the same verification system. An originating institution can instead reach available verification sources through APIs or networks and bring the result back into the payment workflow.

Payee verification is now being built into the places where payments are prepared, checked and released. Connecting those checks across domestic systems gives banks a way to carry recipient verification into payment flows that no longer stop at the borders where many of the original verification schemes were built.