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Pay.UK response to Which? comments on scams reimbursement

Pay.UK recognises the devastating effect of authorised push payment (APP) fraud on innocent victims. We are committed to playing our part in supporting the delivery of an effective mechanism to help make sure that payment service providers are able to reimburse their customers who are victims of APP fraud. This is why we recently ran a detailed and comprehensive Call for Information seeking views on the FPS Rule Change that has been proposed by a group of banks and building societies. 

Our Call for Information is the first time that there has been an open, public consultation regarding the “no blame” funding mechanism, so it is essential that we give proper and due consideration to all of the responses and evidence provided. We have received 39 responses to our Call for Information, which closed on 1 October, from a wide selection of organisations both within and outside the payments industry, and we are now analysing the evidence provided in these submissions in detail.

Pay.UK is an independent not-for profit body, with an independent board, and regulated by both the Bank of England and the Payment Systems Regulator. As such, it is vital that we take into consideration the range of views we have received, regarding the way any funding mechanism works, as part of our overall assessment of the proposal. Once we have completed our full analysis, including our policy, operational and legal assessment, our Board will then be in a position to make a properly informed evidence-based decision on the proposal.

We expect to publish our decision by the end of November.

We recognise the significant work that a range of stakeholders, including UK Finance and Which?, continue to undertake to ensure that bank transfer fraud victims get their money back. In particular, we welcome the work that UK Finance is coordinating to consider alternative mechanisms to provide reimbursement.    Any mechanism to reimburse victims will operate alongside the voluntary Contingent Reimbursement Model Code, which will continue to protect consumers under the administration of the Lending Standards Board.

It is pragmatic to provide this contingency, and also demonstrates the continued commitment of the payments industry to work together to tackle APP scams. The power to compensate individual customers is, and always has been, in the hands of the payment service providers should they wish to do so.