EU Instant Payments Rules Shift Sanctions Screening Toward Daily Customer Checks

The EU’s Instant Payments Regulation is forcing payment service providers to rethink how sanctions controls are built into real-time euro payments, as the regulatory framework moves screening for certain EU targeted financial restrictive measures away from transaction-by-transaction checks and toward recurring customer-level verification.

Regulation (EU) 2024/886 requires payment service providers offering instant credit transfers to verify whether any of their payment service users are subject to targeted financial restrictive measures. Those checks must be carried out immediately after a new targeted measure enters into force, immediately after an amendment to such a measure, and at least once every calendar day.

During execution of an instant credit transfer, the payer’s and payee’s PSPs are not required to perform an additional transaction-level check of the payer or payee against those targeted measures beyond the customer-level verification already required under the regulation. The rule is designed to avoid unnecessary disruption to instant payments, which must be capable of completing within 10 seconds and operating 24 hours a day, every calendar day.

Speed changes the screening architecture

A new industry analysis published on 14 August has highlighted the operational consequences of that model for compliance teams. Traditional sanctions workflows often pause a transaction after a possible name match and send it for manual review. That approach is difficult to reconcile with a payment rail where the entire transfer must complete within seconds.

The daily customer-screening model removes that checkpoint from the live transaction path for the targeted financial restrictive measures covered by the regulation, but it shifts pressure elsewhere. Large customer databases must be re-screened at least daily and immediately after relevant sanctions-list changes, creating the potential for significant batches of false positives when lists are updated.

It also creates a timing issue between screening cycles. A customer who becomes sanctioned after a routine batch run must be identified promptly when the new measure or amendment takes effect, making rapid ingestion of sanctions updates and efficient delta screening important operational controls.

The rule does not remove wider sanctions and AML obligations

The regulation is narrower than a general exemption from sanctions screening. Article 5d expressly preserves actions required to comply with restrictive measures outside the targeted financial measures covered by the provision, as well as EU anti-money laundering and counter-terrorist financing law. PSPs with exposure to non-EU sanctions regimes or other restrictive measures therefore still need to design controls around the obligations that apply to them.

For compliance teams, the practical challenge is increasingly architectural: keeping targeted-measure screening current at customer level, processing list changes quickly, controlling false positives and maintaining any additional sanctions or AML controls without undermining the speed of instant payments. The regulation therefore turns sanctions screening from a purely matching problem into a data, timing and workflow-design problem.