New APP Fraud Reimbursement Rules in force from 7th October

All in-scope Payment Service Providers (PSPs) that use of Faster Payments Service (FPS) and Clearing House Automated Payment System (CHAPS) will need to ensure their processes are compliant with the new requirements.

• The Payment Service Regulator (PSR) rules will now require Payment Service Providers (PSPs) to reimburse APP Fraud victims up to £85,000;
• Where more than £85,000 is lost and not reimbursed, customers can lodge a claim with the Financial Ombudsman Service (FOS), which has a compensation limit of £430,000;
• Sending and receiving PSPs will split the costs of reimbursement 50:50;
• The Pay.UK reimbursement claim management system (RCMS) will enable firms to communicate and manage claims; and
• There will be a requirement to reimburse most APP Fraud victims within five business days, or 35 days If firms ‘stop the clock’ to gather additional information.

All in-scope PSPs should ensure that their fraud and consumer protection policies and controls now reflect the new reimbursement requirements as to ensure compliance and effective outcomes.

✅ From providing guidance to conducting fraud assessments, Plenitude’s Fraud Practice can help your firm navigate the new requirements. Prompt action and a strategic plan are key to ensuring your fraud risk management remains resilient, minimises losses and costs, and meets regulatory requirements. For more information visit: https://www.plenitudeconsulting.com/services/fraud-practice