This Week in Compliance Vol. 11

What's been occupying our compliance attention lately? Here's a rundown of notable updates in the world of payments from the past weeks.

EBA Clearing's SEPA-wide Verification of Payee

EBA Clearing has launched a SEPA-wide Verification of Payee (VOP) service, enabling payment service providers (PSPs) to meet the requirements of the Instant Payments Regulation (IPR) ahead of the October 2025 compliance deadline. The service supports IBAN/name matching for SEPA transactions, providing a crucial tool for fraud prevention and ensuring seamless payment processes across the Single Euro Payments Area (SEPA).

With integration into its RT1 and STEP2 platforms, EBA Clearing’s VOP service connects over 5,000 PSPs and offers flexible options for adapting to evolving compliance needs. This early rollout empowers PSPs to fine-tune their VOP approaches and achieve full pan-European reach while enhancing customer trust in instant payments.

The Payments Association Urges Action on the Environmental Impact of Digital Payments

The Payments Association is advocating for the development of a standardized framework to measure and reduce carbon emissions across the digital payments ecosystem. While emissions per transaction are relatively small, the sheer scale of the industry amplifies its environmental footprint, highlighting the need for a unified approach to sustainability.

A recent report by the association's ESG Working Group outlines challenges in establishing emissions data, citing complexities like the vast number of data points and inconsistent measurement practices. Tony Craddock, Director General of The Payments Association, emphasizes that a standardized measurement system could drive meaningful discussions, foster collaboration, and align sustainability goals with commercial objectives, ultimately benefiting both stakeholders and the planet.

UK Payment Systems Regulator Proposes Cap on Cross-Border Card Fees

The UK Payment Systems Regulator (PSR) is advancing plans to introduce a price cap on cross-border interchange fees charged by Visa and Mastercard for European shoppers' online purchases. Following post-Brexit fee increases of up to fivefold, these charges now cost UK businesses an additional £150–200 million annually.

In its final report, the PSR highlights a lack of competition enabling these hikes and is consulting on an interim cap to restore pre-increase levels. This short-term measure will be followed by further analysis to develop a sustainable long-term solution. While industry groups like the British Retail Consortium welcome the move, Mastercard warns against potential market distortions from artificial controls.

PSR Advocates Data Sharing to Combat APP Fraud Across Banks and Tech Platforms

The Payment Systems Regulator (PSR) is urging banks, technology firms, and social media platforms to collaborate in combating Authorised Push Payment (APP) fraud, which cost UK consumers £341 million in 2023. APP scams trick victims into transferring money to fraudsters posing as legitimate payees, eroding trust in both banks and major digital platforms.

The PSR’s report emphasizes the need for cross-industry data sharing to close vulnerabilities exploited by fraudsters. New reimbursement rules aim to incentivize banks to prevent fraud, but the PSR stresses that platforms must also take responsibility. By tackling APP scams at their roots, the regulator hopes to reduce harm and restore consumer confidence. Industry leaders agree that while current measures are a step forward, ongoing collaboration is crucial to address evolving fraud tactics.

Morgan Stanley Becomes First Investment Bank to Leverage Wise Platform for Cross-Border Settlements

Morgan Stanley has partnered with Wise to adopt its technology platform for foreign exchange and international settlement services, becoming the first investment bank to utilize Wise’s high-speed cross-border payment infrastructure. This collaboration allows Morgan Stanley to streamline settlement processes for its corporate clients while reducing operational complexity.

Wise’s platform, with over 65 licenses and direct connections to six payment systems, completes 63% of cross-border transactions in under 20 seconds. According to Samer Oweida, Morgan Stanley’s Global Head of Foreign Exchange and Emerging Markets, this partnership underscores the bank’s commitment to leveraging cutting-edge technology to deliver fast, reliable, and cost-effective payment solutions for its clients.

CFPB Targets Privacy and Consumer Protections in Digital Payments and Cryptocurrencies

The Consumer Financial Protection Bureau (CFPB) is examining how existing privacy and consumer protection laws can be applied to digital payment systems offered by Big Tech, stablecoins, and other cryptocurrencies. It has issued a public request for input on how companies collect, use, and safeguard personal financial data in digital payment ecosystems, often exceeding what is necessary for transactions.

The CFPB highlights concerns about potential misuse of consumer data for practices like personalized pricing. It also proposes clarifications on how the Electronic Fund Transfer Act applies to digital payment mechanisms, ensuring protections against errors and fraud for emerging payment technologies. CFPB Director Rohit Chopra emphasized the need for robust protections to build consumer confidence in these evolving payment systems.

At spektr, we understand that keeping up with regulatory changes and maintaining compliance can feel overwhelming. Let's have a chat about your compliance needs and how we can customize solutions to match your unique business requirements!