PSR updates on preventing APP fraud

Chris Hemsley has written to Dame Harriett Baldwin MP (Chair of the House of Commons Treasury Committee) on the PSR’s progress on implementing measures to better protect consumers from APP scams.

From 7 October 2024, the new reimbursement requirement will introduce consistent minimum standards for firms to reimburse APP scam victims. This new policy means that the cost of reimbursing victims will be shared equally between sending and receiving firms which will incentivise both firms to detect and prevent fraud, thereby protecting consumers.

The PSR is also consulting on extending the requirements to CHAPS in line with the BoE’s proposed changes to include reimbursement within the CHAPS scheme rules.

To ensure industry readiness ahead of 7 October, the PSR expects firms to be taking the following steps:

  • doing more to prevent scams by investing in systems and processes to detect and prevent scams, and making use of  available data and technology;
  • reassessing their fraud risk management to make sure it is fit for purpose, and/or reassessing their transaction limits to ensure that they remain within their risk appetite;
  • engaging with Pay.UK on the development of the reimbursement claim management system, which supports firms to communicate about, and manage, APP scam claims; and
  • communicating transparently to consumers and taking proactive steps to notify consumers of the protections available under the new policy.

Lucy Hadrill