PSR keeps Confirmation of Payee direction in force after 1 November

The Payment Systems Regulator (PSR) has removed the 1 November 2026 expiry from Specific Direction 17 (SD17), keeping Confirmation of Payee (CoP) requirements in force unless the direction is varied or revoked. The policy statement confirms the decision, while Specific Direction 17a, signed by managing director David Geale on 16 October, took effect on 22 October, before the scheduled expiry.

For payment service providers (PSPs) in Groups 1 and 2, this removes any prospect that the existing CoP obligation will fall away on 1 November. The consolidated SD17 requires a directed PSP to have and use a system that sends CoP requests for its customers and responds to requests made to it. At minimum, requests must be sent when a customer sets up a new payee or amends the unique identifiers of an established payee.

The direction applies where both the sending and receiving accounts are UK accounts, subject to exemptions including certain nominated-account and exempt transactions. A PSP may arrange for another person to provide the system, but remains responsible for complying with SD17.

The sunset has become a standing requirement

The original SD17 said the direction would cease to be in force on 1 November 2026, subject to the PSR varying, revoking or extending it. Its rationale was that CoP would by then be an everyday part of directed PSPs' processes and a service customers expected.

The amendment deletes that expiry provision. The revised purpose is to ensure that PSPs conducting relevant business “provide, and must keep providing on an ongoing basis” a CoP service protecting customers when funds are sent over Faster Payments and CHAPS.

The underlying rollout dates remain unchanged. Group 1 PSPs had to have and use the required system after 31 October 2023, and Group 2 PSPs after 31 October 2024. The direction also retains the requirement to comply with applicable CoP rules and standards, notify the PSR within 28 days once the system is in place, and provide information when the regulator requires it.

The PSR made the direction under section 54 of the Financial Services (Banking Reform) Act 2013. Faster Payments and CHAPS are designated payment systems under section 43 of that Act. CoP checks the payee's account name against the other details provided by the payer and, according to the PSR, helps reduce accidentally misdirected payments and certain authorised push payment (APP) scams.

More than 320 organisations now offer CoP checks across UK Faster Payments and CHAPS transactions, with over two million checks completed each day. In Atlas's view, removing the sunset converts an expansion measure into a continuing supervisory baseline: firms should treat CoP availability as part of their permanent payment-control architecture, not as a programme with a scheduled end date.

Expansion remains a separate question

The PSR says it will review the requirement in five years to assess whether it remains necessary and proportionate. It may review it sooner if significant developments in CoP or payments justify doing so.

Separately, the regulator will continue engaging stakeholders on whether the requirements should apply to a wider group of PSPs. It will assess the evidence before deciding whether to consult on a future proposal. The October amendment therefore preserves the current directed population; it does not itself extend CoP obligations to every PSP.

Atlas's records show that the PSR issued Specific Direction 22 on 30 July to require Mastercard and Visa to improve fee information for acquirers, and launched CP26/1 in May on regulatory financial reporting for UK card schemes.

The next stated supervisory milestone is the PSR's review of the CoP requirement in five years, with an earlier review possible if material developments warrant it.