Deadline set for migration to New Payments Architecture

The Payment Systems Regulator (PSR) has set a deadline of 1 July 2026 to complete migration to the new, competitively procured payments infrastructure, with its authorised push payment (APP) fraud reimbursement requirement carrying over into the new arrangements¹.

The reimbursement requirement was introduced for APP fraud within the Faster Payments system, applying to Faster Payments authorised after the regulatory requirement came into force in 2024¹. Under the policy, sending payment service providers (PSPs) must reimburse all customers who fall victim to APP fraud, subject to exceptions and limits, and must do so within five business days, with a "stop the clock" provision allowing extra time to gather information from victims¹. There are two exceptions to reimbursement: where the customer has acted fraudulently, known as first-party fraud, and where the customer has acted with gross negligence¹. The customer standard of caution and any claim excess must not be applied to vulnerable customers¹.

The PSR said the requirement provides a consistent set of minimum standards reaching over 1,500 PSPs, which it described as significantly wider coverage within Faster Payments compared with the Contingent Reimbursement Model (CRM) Code, launched in 2019 as good industry practice¹. In 2022, there were around 207,000 reported APP fraud cases on personal accounts, an increase of 6% on 2021, and losses totalled £485.2 million¹. In 2022, 66% of APP fraud losses within scope of the CRM Code were reimbursed to the victim¹.

The policy statement also set out other elements of the framework. Sending PSPs have the option to deny APP fraud claims submitted more than 13 months after the final payment to the fraudster, and there is no separate minimum value threshold for claims¹. There is a maximum level of reimbursement by value, with the PSR stating it would consult on the appropriate maximum value and publish this in PSR guidance in Q4 2023¹. The PSR also said it would develop additional guidance on the customer standard of caution (gross negligence) to be published in Q4 2023¹. Failure to notify the police cannot be considered a reason for denying a reimbursement claim¹.

Why it matters for households

The migration deadline means the reimbursement requirement that applies to Faster Payments is intended to continue once payments move to the new infrastructure, so the refund position for victims of APP fraud is not expected to lapse at the point of migration. The requirement covers payments made to an account controlled by a person other than the customer, where the customer was deceived into authorising the payment¹. It does not apply to civil disputes, payments across other payment systems, international payments, or payments made for unlawful purposes¹.

For households, the practical effect is that a victim of an in-scope APP fraud can expect a decision and reimbursement within five business days, though the sending PSP can pause that clock to gather more information, and there is no limit on how many times it can do so¹. The absence of a minimum claim threshold means small losses are not excluded on value grounds, while the maximum reimbursement level was still to be set at the time of the policy statement¹. Vulnerable customers are protected from the customer standard of caution and any claim excess¹. The cost of reimbursement is shared 50:50 between sending and receiving payment firms¹.

What happens next

The PSR said it would consult on a specific start date alongside draft legal instruments in early Q3 2023, and expected industry to start work now to implement the requirement¹. It also said it would consult on the appropriate maximum value for APP fraud claims and publish this in PSR guidance in Q4 2023, and would develop additional guidance on the customer standard of caution to be published in Q4 2023¹. Migration to the new infrastructure is to be completed by 1 July 2026¹.

The reimbursement rules for APP fraud sit alongside the wider scams and fraud framework, including the distinction between authorised and unauthorised payments and the maximum refund for APP fraud.