Protect your bank through inbound payment monitoring:  PSR APP fraud regulation overview: What is it and when will it come into force?

A new reimbursement policy for Authorised Push Payment (APP) fraud is being introduced in the UK.

APP fraud happens when a fraudster tricks a victim into sending a payment to an account outside of their control. In 2022, there were around 207,000 reported APP fraud cases totalling losses of £485.2 million.

The new policy aims to increase the number of victims that receive financial reimbursement by offering enhanced consumer protection. In 2022, c. 60% of scams were refunded; the proposed regulatory change aims to increase reimbursement rates to closer to 100%.

This world-first reimbursement policy proposal can be summarized in two key statements:

• It requires banks to reimburse in-scope customers who fall victim to APP fraud in most cases;
• It shares the cost of reimbursing victims 50:50 between sending and receiving banks.