New APP fraud reimbursement rules implemented by the Payment Systems Regulator (PSR) could potentially leave around a quarter of victims without refunds, according to UK bank TSB.
Set to be introduced next year in response to a rise in authorized push payment fraud, the PSR’s plans would allow banks to establish a £100 threshold for reimbursing victims. TSB, which currently refunds 98 percent of fraud cases under its Fraud Refund Guarantee, is urging the regulator to reconsider these proposals. The bank highlights that 20-40-year-olds account for over half (52%) of such cases, while one in six (17%) victims are over 60.
Cases involving amounts under £100 represent a small fraction of total fraud losses—just one percent. However, this still translates to an estimated £5 million stolen from UK households annually based on current fraud rates.
Additionally, TSB is advocating for the removal of a proposed £35 excess fee per claim, arguing that this charge would disproportionately affect financially vulnerable individuals, especially during the ongoing cost-of-living crisis.
The bank notes that over one in ten cases below the £100 threshold involve Advanced Fee Fraud, targeting individuals who are often in precarious financial situations by demanding fees for nonexistent loans.
Moreover, TSB warns that implementing a £100 threshold would exclude a significant number of consumers, particularly those who have fallen victim to scams on social media platforms. For instance, Meta-owned platforms—Facebook, Instagram, and WhatsApp—account for 80% of all purchase fraud reported by TSB. According to UK Finance, more than two-thirds (70%) of all push-payment fraud begins on online platforms.
Paul Davis, director of fraud prevention at TSB, commented: “We welcome these moves by government and regulators to increase customer protection from Fraud. However, many people cannot afford to lose £100 to fraud—especially in the current economic climate—and they deserve protection from increasingly complex scams, many of which occur on social media.”