PSR speaks on preparing for APP scam reimbursement

Chris Hemsley has spoken of the preparatory work that both sending and receiving PSPs should be doing ahead of the mandatory reimbursement requirement for APP frauds coming into effect next year. The new rules will mean that sending and receiving firms must contribute 50:50 to the amounts lost – which the PSR believes should incentivise both sides to act to prevent the fraud happening in the first place.  He noted that while the firms in control of the payment accounts hold these key obligations, social media and telecoms firms can and should do more to prevent APP fraud – and in this respect he welcomed the Online Fraud Charter.

So far as PSR is concerned, it will drive forward its work on transparency by getting and publishing data.  It is, however, aware of the concerns of smaller institutions who will be on the receiving end of payments, particularly about the proposed £415,000 upper limit on reimbursement payments. Such large claims could have a major impact on smaller firms, although they do account for only a very small amount of overall frauds. PSR recommends that these firms can manage their risks by setting sensible transaction limits – most banks already do not allow payments of anywhere near this size.

Emma Radmore