What changed on 7 October 2024
Before October 2024, reimbursement for APP fraud was voluntary under the CRM Code. Not all banks were signatories, and outcomes were inconsistent. The new PSR rules make reimbursement mandatory for all payment service providers that offer Faster Payments.
This means virtually every UK bank and building society must now reimburse eligible victims, regardless of whether they previously signed up to the voluntary code.
Who is eligible
The rules cover individuals, microenterprises (under 10 employees), and small charities (under £1 million annual income) who have been tricked into making a bank transfer to a fraudster.
The payment must have been made via Faster Payments or CHAPS between UK accounts. Payments by card, cash, cheque, or international transfer are not covered by these specific rules (though other protections may apply).
The £85,000 cap and the £100 excess
Banks must reimburse up to £85,000 per claim. They may apply an excess of up to £100, which is deducted from your refund. However, the excess cannot be applied to vulnerable consumers.
If your loss exceeds £85,000, you can still claim the £85,000 under PSR rules and then pursue the remainder through the Financial Ombudsman (which can award up to £430,000) or through court proceedings.
The 5-day and 35-day timelines
Banks must reimburse within 5 business days of your claim. If they invoke ‘stop the clock’ provisions to investigate further, they have up to 35 business days.
Stop the clock can only be invoked for legitimate investigation purposes. If your bank is simply delaying without a genuine reason, this may itself be grounds for complaint.
The 13-month reporting deadline
You must report the fraud to your bank within 13 months of the last fraudulent payment. Claims reported after this window are not covered by the mandatory reimbursement rules.
However, if your claim falls outside the 13-month window, you may still be able to pursue it through the Financial Ombudsman under the longer 6-year limitation period.
Cost sharing between banks
Under the PSR rules, the cost of reimbursement is split 50:50 between the sending bank (your bank) and the receiving bank (where the fraudster’s account was held). This incentivises both banks to prevent fraud.
Importantly, if a bank rejects your claim and is later overturned by the FOS, that bank bears 100% of the cost — they cannot seek the 50% contribution from the receiving bank.