Pay.UK must publish final Faster Payments reimbursement rules and compliance monitoring regime

Pay.UK, the operator of the Faster Payments scheme, was required to finalise and publish its Faster Payments scheme reimbursement rules, and to formally publish its approved compliance monitoring regime, by 7 June 2024¹. Both deadlines were set by the Payment Systems Regulator in its December 2023 policy statement PS23/4, which set out the final parameters of the new reimbursement requirement for victims of authorised push payment (APP) scams¹.

The regulator had already required Pay.UK to submit its proposals for the compliance monitoring regime for approval by 5 April 2024¹. The underlying legal instruments were published alongside the December 2023 statement: a specific requirement on Pay.UK to include the reimbursement requirement in the Faster Payments scheme rules, a specific direction to Faster Payments participants obliging them to comply with the requirement and the rules, and a specific direction to Pay.UK to create and implement an effective compliance monitoring regime¹.

The reimbursement requirement itself takes effect on 7 October 2024, when victims of APP scams must be reimbursed under the policy¹. The main parameters, as confirmed in PS23/4, are:

Parameter	Detail
Maximum mandatory reimbursement	£415,000, applying to all consumers, not automatically indexed to inflation¹
Excess	Sending PSPs may charge up to £100 per claim, but not to vulnerable consumers¹
Claim time limit	No obligation to reimburse where the claim is submitted more than 13 months after the last payment¹
Decision timescale	Sending PSP must decide whether to reimburse within 35 business days¹
Cost sharing	A receiving PSP must send 50% of the cost of a claim to the sending PSP if claimed, within a deadline to be set by Pay.UK¹
Recovered funds	50% of retrieved stolen funds must be returned to the sending PSP by the receiving PSP¹

The consumer standard of caution exception narrows the consideration of gross negligence to four specific circumstances: having regard to interventions, prompt notification, responding to requests for information and police reporting¹. That exception does not apply to vulnerable consumers¹. The regulator also said it recognised that the deadline for Group 2 PSPs to introduce Confirmation of Payee is 31 October 2024¹.

"We are directing Pay.UK to publish the final reimbursement rules by 7 June 2024."

Payment Systems Regulator, PS23/4¹

The regulator said it would monitor the incidence and impact of high value APP scams over the ten months before the start date and may consult on revising the maximum reimbursement level ahead of October if there was convincing evidence to do so¹. It described October 2024 as the earliest date that the critical systems and processes could be in place¹.

Why it matters for households

From 7 October 2024, people who are tricked into sending money by bank transfer to a fraudster are to be reimbursed by their sending payment firm, subject to the exceptions and limits above¹. The £100 excess, where a firm applies it, reduces the amount a claimant receives, and it cannot be charged to vulnerable consumers¹. Claims made more than 13 months after the last payment in the case need not be reimbursed¹, and firms have 35 business days to decide¹. The £415,000 cap applies to all consumers and is not automatically uprated with inflation¹. The rules sit within Faster Payments, the system used for most everyday bank transfers, and replace the voluntary arrangements described in the Contingent Reimbursement Model Code. The regulator's wider work on APP scam reimbursement and Confirmation of Payee sits under the Payment Systems Regulator.

What happens next

The reimbursement requirement applies from 7 October 2024¹. Group 2 PSPs face a 31 October 2024 deadline to introduce Confirmation of Payee¹. Pay.UK must set the deadline for receiving PSPs to pass 50% of claim costs to sending PSPs¹. The regulator has said it may consult on revising the maximum reimbursement level before October if convincing evidence emerges¹.

Sources1 cited