On Wednesday 22 October 2025, the Luxembourg Bankers’ Association (ABBL) announced that the implementation of the Verification of Payee (VoP) system, introduced on 9 October 2025 to reduce the risk of fraud and transfer errors, had been generally well managed by Luxembourg’s financial sector despite major technical challenges and tight deadlines.

According to the ABBL, the new system automatically checks the match between the recipient’s name and their IBANbefore executing a standard or instant euro transfer within the SEPA zone, enhancing both security and reliability. The initiative, launched under the impetus of the European Commission as part of the rollout of instant payments, required banks and payment service providers to implement significant technical and cross-border adjustments within just eighteen months.

“Banks and payment service providers had a total of eighteen months to implement this extensive project, given its technical complexity and cross-border nature,” said Ananda Kautz, Member of the ABBL Management Committee. She noted the main challenges included upgrading infrastructure to support real-time operations 24/7, ensuring continuous liquidity management, meeting compliance obligations for anti-money laundering and sanctions control, and strengthening cybersecurity in a round-the-clock operational environment.

“The first feedback we received from Luxembourg’s major retail banks, as well as from LuxHub, shows that the implementation has been generally well managed by our members,” said Galina Miroshnichenko, ABBL Adviser for Payments and Digital, who coordinated the project within the association. She added that LuxHub reported an average response time of 149 milliseconds, highlighting the system’s efficiency.

The ABBL stated that in some cases, transfers to certain foreign countries have shown “Verification not possible” messages when receiving institutions were not yet equipped for the system. Users can still complete transfers, but are encouraged to do so with caution.

Preliminary data showed that 60% of transfers resulted in a “Match,” 19% in a “Close Match,” 14% in a “No Match,” and 7% in “Verification not possible.” These discrepancies, the ABBL explained, may result from the use of trade names, abbreviations or acronyms.

“To further reduce the rate of Close or No Match, we invite consumers to update their lists of beneficiaries using the beneficiary’s official bank account details (RIB) or information provided on invoices. While this may temporarily inconvenience some clients, it ultimately benefits transfer security and user comfort,” said Ananda Kautz.

“The introduction of the VoP is certainly a major step forward in terms of security and error reduction, but it is not a full guarantee against financial crime,” added Galina Miroshnichenko. “Most transfers are not urgent, so it is important to remain vigilant and keep good security habits.”

The ABBL reminded customers to verify transaction details carefully, avoid suspicious links, protect their LuxTrust credentials and update banking apps regularly.

More information and consumer advice are available on the ABBL website: https://www.abbl.lu.