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Digital payments: Navigating the landscape, addressing fraud, and charting the future with Confirmation of Payee solutions
Journal of Payments Strategy & Systems,
17
(4),
359-371
(2023)
Abstract
This paper explores the evolving landscape of digital payments, with a specific focus on the confirmation of payee (CoP) mechanism, which has been designed to enhance the accuracy and security of payee identification. Traditional payee identification methods, reliant solely on account numbers, face increasing limitations amid the growing sophistication of both domestic and cross-border payments. The rise of instant payments and their associated fraud risks underscore the urgent need for more reliable payee identification systems. Drawing insights from domestic markets where CoP has been implemented, this paper presents the challenges, regulatory responses and the potential of a CoP scheme for Europe and globally. We argue that while a singular European solution is unlikely, interoperability will be the key to success. The paper concludes by envisioning the future of payee identification, exploring the global potential of CoP, and urging the industry to perceive CoP solutions as public goods of benefit to all stakeholders in the payments sector.
Keywords: digital payments; confirmation of payee (CoP); payee identification; instant payments; cross-border payments; fraud risks; interoperability
The full article is available to subscribers to the journal.
Author's Biography
Damien Dugauquier is the co-founder and Chief Executive Officer at iPiD based in Singapore. As former Head of Data and Analytics at SWIFT, Damien brings a wealth of payments knowledge and experience, having worked with financial institutions and corporates across Asia and Europe.
Geertjan Van Bochove is the co-founder, Chief Operations Officer and Chief Financial Officer at iPiD, based in the Netherlands. Geertjan is a serial entrepreneur, and has amassed considerable experience in the payment industry, working closely with European banks and European payment systems.
Alain Raes is a founding partner and Chief Operations Officer at iPiD, based in Belgium. With his 15-year tenure in the executive committee of SWIFT, Alain has built a reputation of formulating effective business growth strategies. Alain has worked with banks and market infrastructures alike, and was there at the inception of instant payments and overlay systems across the globe.
Jean-Julien Ilunga is Regional Director for Europe at iPiD, based in Belgium. Jean-Julien spearheads the development of iPiD’s sales strategies and initiatives in Europe and has an investment banking background.
