LSEG highlights how rising fraud and new EU rules are reshaping payments, calling for stronger data, technology, and collaboration to rebuild trust across the ecosystem.
Faster payments are re-imagining the payments landscape, offering tangible and immediate benefits ranging from enhanced speed and convenience to round-the-clock availability. At the same time, payments risk is rising.
In my view, the proliferation of instant payments is one of several factors contributing to a rise in fraud, including account takeovers, synthetic identity fraud and deepfakes.
One notable payment scam is authorised push payment (APP) fraud, in which criminals trick victims into authorising payments. The numbers are significant. Global APP fraud losses are projected to reach a staggering US$331 billion by 2027.
This leaves payment industry stakeholders facing a challenging landscape. We must embrace the trend towards ever faster transactions, in line with consumer expectations, while also finding innovative ways to combat fraudsters. It is a delicate balancing act.
In the UK, the value of APP scams was £460 million (around US$576 million) in 2023. APP fraud accounted for approximately 40% of UK payment fraud, which in turn represented 40% of all reported crime in the country in 2023.
Building a trust-based payments ecosystem
Given the backdrop of rising fraud increasingly defining the future of the payments industry, how is the payments space evolving?
Trust is emerging as the key element needed for long-term stability and better security.
This trust can be built in many ways, including through regulatory changes. A pertinent example is the EU’s new mandatory verification of payee (VoP) requirements. The changes came into effect in October 2025, meaning that VoP is now mandatory for all PSPs across the EU.
The new rules introduce stricter requirements around payee data verification, specifically requiring confirmation that a payee’s details match the account details held at the receiving bank. The move directly affects PSPs, which must now verify both the name and the account number of a payee before executing regular or instant SEPA credit transfers.
While PSPs are directly obligated to comply, the changes are also sending ripples across the entire payments ecosystem.
Corporates are also impacted. Firms will need to assess and update their processes to respond to incoming VoP results. For example, if the reported details do not fully match, there must be mechanisms in place to deal with this.
These developments should be welcomed, which promote shared ownership of the collective responsibility to protect all stakeholders in the payments industry. The changes directly address the challenges of APP fraud, misdirected payments and impersonation scams, while underscoring the importance of data-driven fraud prevention.
Data, technology and a proactive approach
On a macro level, regulatory changes such as VoP will help to secure payments and build trust across the payments space. On a micro level, several measures are available to banks, PSPs, corporates and others to assist with this task.
Responding to complex crime in payments is challenging, particularly given the tight regulatory timeframes for screening instant payments. However, the right approach can help firms ensure that their screening is fast, accurate and capable of delivering real results. Effective screening must pinpoint potential crime, verify identity and check bank account details, all without slowing the pace of global business.
A substantial part of the solution lies in accessing the right data at the right time.
Technology also plays a pivotal role, always with trusted human oversight. This includes technology that enables real-time verification of bank accounts, as well as broad-based collaboration, including data sharing between institutions, law enforcement, regulators and technology providers.
Above all, a proactive approach to regulatory compliance is essential. An always-on mindset of continuous fraud prevention offers the best chance of combating rising crime with efficacy.
