The UK launched a mandatory refund scheme for authorized push payment (APP) fraud, requiring banks and payment firms to reimburse victims up to £85,000. The system, active from October 2024, splits refund costs between sending and receiving firms, with most claims resolved in five days. Some firms may impose a £100 excess, but vulnerable customers are exempt. The plan, introduced after industry lobbying, pushes financial firms to improve fraud prevention while addressing the growing problem of online fraud. Concerns remain about its potential impact on the payments industry.
Key Points:
- Victims of bank fraud can be reimbursed up to £85,000 under new rules.
- Refund costs will be split between sending and receiving banks.
- Firms may impose a £100 excess on claims, but vulnerable customers are exempt.
- The initiative aims to strengthen fraud prevention efforts.
