Amended legal instruments for APP scams reimbursement published

The Payment Systems Regulator (PSR) published amended versions of three legal instruments giving effect to its authorised push payment (APP) scam reimbursement policy on 12 July 2024¹. The instruments are Specific Requirement 1, Specific Direction 19 and Specific Direction 20¹. The regulator also confirmed the policy start date of 7 October 2024¹.

The instruments set out the mechanics of the APP reimbursement requirement within Faster Payments. Specific Requirement 1 is imposed on Pay.UK and requires it to create the reimbursement rules¹. Specific Direction 19 directs Pay.UK to create and propose plans for a compliance monitoring regime¹. Specific Direction 20 contains the reimbursement requirement and directs in scope payment service providers (PSPs) to comply with the reimbursement rules¹.

The PSR said the publication sets out the final detailed parameters of the reimbursement requirement, alongside the legal instruments used to implement the policy¹. It covers the consumer standard of caution, the level of the excess, the maximum level of reimbursement, the start date and the legal instruments¹. The regulator said the documents are relevant to the payments industry, consumer groups, payment service providers and prospective qualifying consumers who use authorised push payments to send money and fall within scope of the policy¹.

The PSR said it expects industry preparations for the reimbursement requirement to gather momentum now that the legal instruments, start date and outstanding policy issues are settled, and that it will continue to monitor and support Pay.UK's and PSPs' progress towards implementation¹. It said it will engage directly with PSPs and trade associations and set up a process to address implementation and policy questions¹. Firms with questions not answered in existing publications can email the regulator's App Scams Policy mailbox, which it said it checks daily Monday to Friday, aiming to respond to all queries within ten working days, and to keep firms updated where a response takes more than seven days¹. The PSR said some queries, such as requests for legal advice or how the policy applies to the facts of a particular case, may not be answered¹.

Why it matters for households

From 7 October 2024, people who are tricked into sending money by bank transfer to a fraudster fall within the reimbursement requirement set by the PSR¹. The policy applies to consumers using authorised push payments who are within scope, and the rules are to be created by Pay.UK and complied with by in scope PSPs¹. The PSR's publication confirms the final position on the consumer standard of caution, the excess and the maximum level of reimbursement, though the specific figures are not set out in the text of this publication¹. The distinction between FSCS protection and APP reimbursement remains relevant for consumers working out which route covers a loss.

What happens next

The PSR said it will monitor and support Pay.UK's and PSPs' progress towards implementation, engage with firms and trade associations, and run a process for implementation and policy questions ahead of the October 2024 start date¹.