In the first three months of the new regime, 86% of money lost to in-scope APP scams (approximately £27 million) was successfully returned to victims. This performance reflects widespread adoption of the rules by payment service providers (PSPs).
Another good sign is that the volume of APP fraud claims has remained stable, addressing initial concerns about a potential surge. The PSR attributes this success to the collaborative efforts of PSPs to prevent fraud as the cost of reimbursement is shared by both payer and payee institutions. Many firms have invested in staff training and adapted their internal processes to align with the new regulatory requirements.
The PSR’s data also shows that vulnerable customers are seeing tangible benefits. With PSPs required to act promptly and fairly, outcomes for those at greater risk of fraud, or less able to recover from financial loss are improving.
However, the regulator has noted some inconsistencies in how firms are applying exemptions to reimbursement. Only a small proportion (2%) of claims have been rejected for not meeting the consumer standard of caution, However, that are seeing differences in how frequently firms are applying the exemptions. This suggests that some firms are invoking the exceptions (such as gross negligence or failure to meet the consumer standard of caution) more often than others, leading to inconsistencies in how victims are treated across the sector. The PSR has acknowledged this issue and is monitoring it as part of its ongoing oversight of the reimbursement regime.
The initial phase of the APP scams reimbursement requirement indicates a positive shift towards enhanced consumer protection in the UK’s payment sector. Payment firms are encouraged to continue refining their fraud prevention strategies and prepare for forthcoming regulatory consultations to ensure ongoing compliance.
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As the APP reimbursement regime continues to evolve, ensuring your organisation is fully compliant and prepared has never been more important. Whether you need support with fraud prevention strategies, staff training, or navigating regulatory requirements, our team is here to help. Contact us today to discuss how we can support your payment services needs.
