A mandatory reimbursement scheme for authorised push payment (APP) fraud, implemented by the Payment Systems Regulator (PSR) on 7 October 2024, has significantly improved outcomes for victims. In the first 18 months of the scheme, reimbursement rates for APP fraud climbed to 88%, up from 61% in 2024.
Under the scheme, payment providers are required to reimburse victims of APP fraud, where individuals inadvertently send money to scammers, up to £85,000 in most circumstances. Only 2% of cases have been rejected due to victims failing to meet the 'consumer standard of caution'.
Despite these improvements, substantial gaps in protection remain. The scheme does not cover transfers to international bank accounts, or payments made using cards, cryptocurrency, and money-transfer apps. Around 30% of APP fraud claims are rejected as out of scope, with no detailed breakdown from the PSR explaining why.
Concerns are also growing over potential threats to the scheme's future. There is increasing pressure to exclude investment and cryptocurrency fraud entirely from the reimbursement scheme. Additionally, government proposals to narrow the Financial Ombudsman Service's (FOS) 'fair and reasonable' remit could weaken its role as a backstop for compensation.