(10 February 2025 – Europe) Payment identity network iPiD has partnered with Microsoft to develop an AI-driven name-matching tool designed to enhance Verification of Payee (VoP) compliance.
Name matching is a critical component of payment security and regulatory compliance, ensuring that financial institutions do not process payments for sanctioned entities. However, upcoming European regulations, set to take effect in October, introduce stricter VoP requirements, mandating that banks verify a payer’s provided name against the recipient’s registered account name to combat fraud.
Under the new rules, banks must classify name matches into three categories before processing a payment – match, partial match (minor discrepancies such as spelling errors), and no match.
While partial matches improve customer experience by accommodating variations in names, they risk violating GDPR regulations by unintentionally exposing unintended payee details.
To solve this challenge, iPiD has leveraged Microsoft Azure OpenAI Service to build an advanced name-matching algorithm tailored to VoP’s complexities. The technology balances accuracy, compliance, and efficiency, minimising false negatives while adhering to strict data privacy rules.
Ivan Chong, CTO, iPiD, highlights the importance of AI in name verification: “Names are more than just letters; they carry identity and meaning. With AI, we can bridge the gap between technical precision and contextual nuance. Thanks to our collaboration with Microsoft, we’ve created a solution that combines the linguistic depth of large language models with essential requirements like speed, resource efficiency, explainability, and adaptability.”