UK banks will soon be required to reimburse victims of fraud more quickly under updated regulations designed to enhance consumer protection. The new rules, set to take effect in 2024, aim to streamline the reimbursement process for victims of authorised push payment (APP) scams.
What’s Changing?
The revised Confirmation of Payee (CoP) system will now include additional checks to verify payee details, reducing the risk of fraudulent transactions. Banks will also face stricter deadlines to process refunds, ensuring victims receive compensation within five business days in most cases.
Key Improvements:
- Faster reimbursements – Victims of APP scams will receive refunds within five working days.
- Enhanced CoP checks – Additional verification steps will help prevent mistaken or fraudulent payments.
- Stronger bank accountability – Financial institutions must prove they took reasonable steps to prevent fraud before refusing a refund.
Why This Matters
APP scams have surged in recent years, costing UK consumers millions annually. The new measures aim to shift more responsibility onto banks to detect and prevent fraud while ensuring victims are not left financially stranded.
Experts say the changes will "reduce delays and improve trust in digital payments", though some warn that banks may pass on costs to customers through higher fees.
What’s Next?
The Payment Systems Regulator (PSR) will finalise the rules later this year, with full implementation expected by mid-2024. Consumers are advised to remain vigilant and double-check payment details, even with the improved safeguards.
