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Details of how the UK’s new mandatory reimbursement rules for authorised push payment (APP) scam victims are performing show early success in protecting consumers and levelling the financial services playing field.
According to the Payment Systems Regulator (PSR), 86 percent of money lost to APP scams within the scope of the new policy was returned to victims in the three months following its October 2024 implementation, amounting to approximately £27m.
This compares favourably with pre-policy trends: UK Finance data for 2023 showed a reimbursement rate of 68 percent by value, although direct comparisons are complicated by changes in definitions and methodology.
“We are pleased with what we’ve seen in the data and heard from stakeholders in the first few months, which demonstrates that the policy has been successfully implemented — and more consumers have been protected,” said David Geale, managing director of the PSR, in a blog post unveiling the data.
“This is testament to the efforts of industry to deliver the best outcomes for victims of APP scams and work with us to resolve any issues.”
Vulnerable customers, who had been a significant focus of the reform, appear to be better shielded under the new regime. The data revealed so far by the PSR shows that claims from such individuals accounted for 14 percent of the total, equating to £7m in reimbursements.
The regulator also reports a significant expansion in the number of firms reimbursing victims.
Prior to the policy’s implementation, reimbursement was largely confined to customers of the ten firms signed up to the voluntary Contingent Reimbursement Model Code.
In contrast, 60 firms have reimbursed APP fraud claims under the mandatory framework, which the regulator believes represents a more level playing field.
“The policy is having an impact and we’re seeing positive results. A high proportion of APP scam victims are being reimbursed consistently across a larger number of PSPs,” said Geale.
Changing times
Although he acknowledged that it is too early to draw firm conclusions based on the period covered by this data, “we have not seen evidence of spikes in claim volumes that some had feared would occur under the policy”.
Around 46,000 claims were made in the first three months of the policy, compared to an average quarterly rate of 56,000 reported by UK Finance last year.
Overall, APP fraud reimbursement volumes are gradually rising and are expected to continue increasing as public awareness of the reimbursement scheme grows.
The PSR noted that its initial figures exclude scams that occurred before the policy’s October 7, 2024 start date, which may partly explain the lower numbers.
However, the Bank of England, the Financial Conduct Authority (FCA), and the Financial Ombudsman Service also confirmed they had not seen a surge in complaints or fraud cases relating to the new reimbursement rules.
Indeed, cases of moral hazard and first-party fraud have also been a rare occurrence, and only two percent of claims were rejected on grounds of gross negligence, with just 23 percent of firms invoking this exemption.
The regulator has said that it is monitoring differences in how the rules are being applied and will work with the Financial Ombudsman and other stakeholders to ensure consistency.
Meanwhile, responsibility for covering losses is now shared between the sending and receiving firms, incentivising both sides to prevent fraud.
The early data also shows progress in cooperation, with 86 percent of claims passed between firms within two business hours, and 84 percent closed within five business days, a trend the PSR says is helping rebuild consumer trust during difficult periods.
Although it is encouraged by the early outcomes, the regulator stressed that more work is needed, especially around improving the quality of information sharing between firms to help prevent scams before they occur.
An independent review of the policy's effectiveness is scheduled for October 2025, once the rules have been in place for a full year.
