Bank transfers: New rule from October – affecting millions of bank customers

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In addition to paying with mobile services such as PayPal, bank transfers are the means to an end for many people. However, something is changing here, starting on October 9, 2025. That is when EU directives will become binding, which, among other things, are intended to guarantee greater security for money transfers.

Bank transfers: what’s new

Behind the new European Union regulation is the obligation, coming into force in January 2025, for banks to offer instant transfers at no additional cost. This should make it possible to send funds to the recipient’s account within ten seconds, around the clock, both nationally and across borders.

“Where the payment service providers referred to in paragraph 1 are located in a Member State whose currency is the euro, they shall offer their payment service users the receipt of real-time transfers in euro in accordance with this Article by January 9, 2025, and the sending of real-time transfers in euro in accordance with this Article by October 9, 2025,” states the relevant EU regulation.

In addition to this obligation to provide the service, there is also another requirement: the verification of the recipient, i.e., the comparison of the name and account number by the responsible bank. In the future, this will apply to all 27 EU countries as well as Norway, Iceland, and Liechtenstein. Payment service providers not based in the EU must comply with this requirement from 2027.

What the new verification is all about

The imminent verification of the person who is the target of the money transfer is a key innovation in the EU regulations for instant transfers. The procedure is to be introduced in order to increase security during transmission and reduce the number of incorrect transfers.

This is how the verification works:

Comparison of name and account number: Before the transfer is authorized, the payment service provider compares the name of the recipient entered by the payer with the corresponding account number (IBAN).

Notification of discrepancies: If the name does not match the stored account number exactly or only partially, the payer is notified that there are discrepancies. You can then decide whether you want to continue or cancel the payment.

Protection against fraud: The verification is intended to prevent money from being sent to the wrong accounts, whether due to typos or fraudulent intent.

Reduction of incorrect transfers: Many incorrect transfers are caused by incorrectly entered IBANs or names. This verification minimizes the risk.

Liability issues: If a payment service provider fails to properly verify the identity of the recipient and damage is caused as a result, the provider may be held liable and required to reimburse the amount.