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Push payment fraud reimbursement overview:
- Who: The Payment Systems Regulator has created new rules for banks and payment companies to follow that are being put in place in an effort to help consumers who are victims of authorised push payment fraud.
- Why: The new regulations will ensure more people will be reimbursed if they are victims of push payment fraud, and to prompt more action to be taken to prevent the fraud from happening in the first place.
- Where: Across the UK.
Banks and payment companies in the UK will soon be required to reimburse the majority of victims of authorised push payment fraud (APP) within five business days, according to new requirements set by the Payment Systems Regulator (PSR).
The PSR said the requirements — which are set to go into effect next year — “will ensure more people than ever” will be reimbursed in the event they are victims of APP, and prompt more action to prevent the fraud from happening in the first place.
“Once implemented, our changes will deliver a major shift from the status quo, giving everyone across the payments ecosystem a reason to act to prevent fraud from happening in the first place,” said Chris Hemsley, managing director at the PSR, in a statement.
APP fraud is one of the most significant types of fraud both in the UK and around the world, according to the PSR, which said it has caused individuals to suffer financial losses totalling nearly £500 million in the last year alone.
Rules put in place to ensure UK consumers are protected when making payments, says PSR
The new requirements have ultimately been in place to ensure individuals are protected when making payments, according to the PSR, which noted that instances of APP fraud have had “a devastating impact on many people’s lives.”
“As payment scams become ever more sophisticated, it is right that the Government, the regulator and industry work together to ensure victims are not left out-of-pocket by fraudsters,” said Economic Secretary Andrew Griffith, in a statement.
Payment firms will be incentivised to take action under the new rules, according to the PSR, which said the requirements will call for sending and receiving firms to equally split the cost of reimbursement.
The PSR said it plans to publish the claim excess and maximum level of reimbursement — along with additional guidance on the customer standard of caution — along with all legal instruments by the end of this year.
According to research revealed last year, consumers in the UK lost £1.3 billion last year due to online payment fraud, with APP fraud determined to be a significant factor.
Have you been a victim of authorised push payment fraud? Let us know in the comments!
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