Fraud victims must be refunded in five days

Banks will have to refund victims of authorised push payment (APP) scams within five days.

Although most banks and payment companies have voluntarily reimbursed victims, the new rules mean this will now be a requirement from 7 October.

APP scams occur when people are tricked into sending a criminal money by pretending to be someone else, like their bank.

Lower payouts

The new rules have been brought in by the Payment Systems Regulator (PSR), who have also reduced the maximum amount of compensation you can claim, bringing it line with the Financial Services Compensation Scheme (FCSC) limit.

The PSR say the new £85,000 limit – down from £415,000 – will cover more than 99% of claims.

Of more than 250,000 cases last year, there were 18 times when people lost more than £415,000 and 411 where they lost more than £85,000.

The watchdog claims this limit will give firms “strong financial incentives” to improve their fraud prevention measures.

After making refunds, banks and payment companies will also be able to claim half of the money back from the financial institution used by the fraudster to receive the stolen money.

Where can I find more information about scams and fraud?

Read more in our guide about common types of fraud, including what to do if you think you've been scammed.