The Payment Systems Regulator (PSR) published a consultation in May 2024 on proposals to direct banks and other payment firms participating in CHAPS to reimburse their customers who have been victims of authorised push payment (APP) scams1. The consultation is listed in the regulator's own history of its APP scams work, which records the step under May 20241.
The proposal would extend reimbursement duties beyond the Faster Payments scheme. The PSR's existing reimbursement requirements came into force on 7 October 20241. In December 2023 the regulator set out the final detailed parameters of that requirement, the legal instruments used to implement the policy, and confirmed the 7 October 2024 start date1. It said at the time that it had confirmed new requirements for banks and payment companies that "will ensure more people than ever before will get their money back if they are a victim of APP fraud"1.
"We published a consultation on proposals to direct banks and other payment firms participating in CHAPS to reimburse their customers who have been victims of APP scams."
The PSR's wider work on APP scams dates back to 20161. In October 2022 it directed around 400 more financial firms to provide Confirmation of Payee, which it said would see nearly all transactions made via Faster Payments and CHAPS covered by Confirmation of Payee by October 20241. In March 2023 it directed 14 of the largest UK payment service provider groups to collect and provide data on their APP scam performance1. In May 2024 it also published a list of payment service providers that may fall in scope of Specific Direction 20, which requires sending firms to inform existing consumers of their rights under the reimbursement requirement and rules; the list is to be updated as necessary1.
The consultation outcome, and whether CHAPS reimbursement will be introduced, have not been reported in the material available. The PSR's history records the consultation being published but does not state a decision, a start date or the scope of firms that would be covered1.
Why it matters for households
APP scams involve a person being tricked into transferring money to a fraudster. Under the reimbursement requirement that took effect on 7 October 2024, victims of APP scams made over Faster Payments have a route to refunds from their payment firm1. The May 2024 consultation concerns payments made over CHAPS, a separate system typically used for higher value transfers1. If the proposals were adopted, firms participating in CHAPS would be directed to reimburse customers who are victims of APP scams, extending the protection to a set of payments not covered by the Faster Payments rules1. The PSR has not reported which firms would be in scope, what the maximum level of reimbursement would be, or when any requirement would begin1. The maximum refund for Faster Payments APP scams was confirmed separately in the PSR's October 2024 policy statement1.
What happens next
The PSR's history records the CHAPS consultation as published in May 20241. No decision, final direction or implementation date for CHAPS reimbursement appears in the material available, and the regulator has not reported one1. The Faster Payments reimbursement requirement came into force on 7 October 20241.
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