Banks Have Checked the Payee's Name on 404 Million Transfers in a Year, and One That Skips the Check Must Refund You

For a year now, Portuguese banking apps have shown a name check before a transfer goes out. The Bank of Portugal said on Tuesday that the service it runs for the purpose has checked the payee on 404 million payments since it went live on 5 October 2025. It is used by 39 payment providers operating in Portugal and, under an arrangement with the European Central Bank, by 30 foreign providers from ten countries.

The central bank's 2025 payments report counted 94 million checks in the first three months, to 31 December, which leaves about 310 million so far in 2026, by our arithmetic. Use peaks at 10:00 and halves at weekends.

What the check is, and what the law requires

The check comes from the EU's Instant Payments Regulation, Regulation (EU) 2024/886, which required banks in the euro area to offer it by 9 October 2025. Under its Article 5c, your bank must compare the name you type with the name held on the destination IBAN before you are allowed to authorise the transfer. The rule covers ordinary and instant transfers, through any channel, including a paper order at the counter.

There are three outcomes. If the name matches, the payment goes ahead normally. If it almost matches, the bank must show you the account holder's real name. If it does not match, the bank must tell you, and warn you that authorising the transfer could send the money to an account that does not belong to the person you meant to pay.

The check never blocks you: the regulation says you can still authorise the transfer. It must be free (Article 5b). Businesses sending payments in bulk may opt out; consumers cannot.

Who pays when it goes wrong

This is the part most worth knowing. If your bank fails to run the check and the transfer goes to the wrong place as a result, the bank must refund you without delay. If the bank did run the check and you went ahead after a warning, it is not liable for a payment sent to the wrong account number, and banks must tell customers what ignoring a warning means for their refund rights.

In Portugal the European service builds on the Bank of Portugal's own payee confirmation, which came in 2024. The new one can also check joint account holders, not just the first one, and it works for transfers to other euro area countries.

What it does to fraud

The central bank's latest fraud figures cover the first half of 2025, before the European check arrived. Credit transfers had ten fraudulent operations per million, down from 16 a year earlier, but each one was large, averaging 2,564 euros. Cases where the customer was manipulated into paying fell to 16 percent of transfer fraud, 24 points lower than in 2024. The Bank of Portugal links that fall to its payee confirmation tools. Losses from card and transfer fraud fell to 5.3 million euros, from 8.9 million.

A name check has a limit, though: it confirms that the name and the account belong together, not that the person behind them is honest. The scams the report saw growing in 2025 were fake job offers and investments, messages posing as relatives, and apps that hand fraudsters remote control of a phone, where the victim often pays an account whose name matches perfectly. When customers start the payment themselves or hand over their codes, the report notes, the loss tends to fall on them.

The Bank of Portugal has since set up a digital fraud monitoring platform with banks, telecoms and the police, and the securities regulator has warned about AI-video investment pitches. For everyday payments, see our guide to MB Way and Multibanco.