APP fraud reimbursement
The UK regime under which payment service providers must reimburse victims of authorised push payment fraud, within defined limits and conditions.
APP fraud reimbursement is the UK regime under which payment service providers must reimburse victims of authorised push payment fraud, within defined limits and conditions. It shifts some of the loss from the deceived payer to the firms that send and receive the payment.
The regime changes the economics of APP fraud for banks and payment firms, giving them a direct stake in preventing it rather than treating it as the customer's problem. For businesses, it provides a measure of protection, but reimbursement is subject to limits, exceptions and an expectation that the payer took reasonable care.
It is best understood as a backstop, not a substitute for prevention. Verifying suppliers and bank details before paying remains the reliable way to avoid the loss, and the dispute, altogether.
The reimbursement requirements are set by the Payment Systems Regulator (PSR) and apply to in-scope UK payment systems, subject to defined limits, exceptions and a consumer standard of caution.