How do you solve a problem like protections in interbank payments?


APP scams

by Genevieve Marjoribanks, Head of Policy

When it comes to protections in interbank payments, we’ve spent a lot of time thinking about whether more needs to be done. Since the PSR began, we have been interested in the protections available in interbank payments – you only have to look at our work on protections and prevention against Authorised Push Payment (APP) scams to see that this is an important subject for us.

Last summer, I wrote two pieces that focused on improving outcomes for victims of APP scams, and referred to a new piece of work that would look at what protections are available in interbank payments. In this latest piece, I want to give you a bit more of an idea about how our work in these areas is shaping up.

APP scams

Protecting people from APP scams continues to be a key priority for the PSR. There’s been so much progress in this space, but even with the protections that come from Confirmation of Payee, we need an ongoing effort to stop these frauds from happening in the first place, as well as continuing to look at protections for people who do fall victim.  

When the industry-led Contingent Reimbursement Model (CRM) Code was launched in May 2019, it marked an increased level of protection for victims of this devastating crime who acted appropriately and yet still suffered a loss. 

Since its introduction, we’ve been monitoring outcomes under the Code. And while the Code has improved outcomes for consumers, we don’t think it has gone far enough. We estimate that 40 - 45% of APP scam losses are making their way back to victims.  

To date, we’ve been restricted to advocating industry-led approaches to tackling APP scams because of requirements stemming from European Union (EU) law which are still in place in domestic law. Even though we currently still face these restrictions on requiring reimbursement for APP scams, it’s possible that these restrictions could be lifted in the future. In light of the evidence we’re seeing on customer outcomes under the Code, we want to be ready to take appropriate action should the restrictions be lifted.  

That’s why we’ve been speaking with the Treasury about the legislative restrictions that are currently in place through the Payment Services Regulations (PSRs) 2017. While these regulations continue to form part of UK law after EU exit, it is open to Government to legislate in future to remove these restrictions, meaning the PSR could then look to require reimb