UK Payments Regulator to Require Repayment for Push Payment Fraud

The U.K. Payments System Regulator (PSR) is requiring repayment to victims of authorized push payment (APP) fraud after more than 350 million pounds ($469 million) were swiped in the first half of 2021, according to a Thursday (Nov. 18) report from Computer Weekly. 

APP fraud, which involves customers authorizing payments to cybercriminals thinking it is a legitimate purchase, grew by 71% in the first six months of the year, according to PYMNTS. In addition, schemers stole about 754 million pounds ($1.01 billion) through bank-related fraud across Britain in the first half of 2021, an increase of 30% from the same period in 2020. 

See more: UK Bank Lobby Group: Fraud Threatens National Security 

The regulator is assessing how to prevent losses to authorized push payments, which involves customers enabling their bank or digital wallet to unknowingly send money to a scammer, according to Computer Weekly. PSR has tasked banks and technology firms with being more open about authorized push payment fraud, stepping up prevention and making repayment to victims a requirement, according to the report. 

In all, 355 million pounds ($476 million) was stolen via APP fraud during the first six months of the year, according to the report.  

Trade association UK Finance has called the higher levels of fraud in the U.K. a “national security threat,” according to PYMNTS. 

As digital payments continue to grow at a fever pitch, so too do the incidences of fraud. Payment fraud losses are anticipated to surpass $200 billion by 2025, according to a recent PYMNTS report, which was undertaken in conjunction with U.S. cybersecurity firm LoginID. 

Those in the banking and financial services sectors are responding with stepped up efforts to nab fraudsters.

U.K. banks prevented $44 million in scams between January and June of this year as part of a rapid scam response dubbed the Banking Protocol, according to PYMNTS. The program helps train bank personnel on detecting suspicious activities when interacting with bank customers. During the six-month period, the Banking Protocol was used in nearly 5,000 instances and played a role in the arrest of 90 fraudsters. 

Related: UK’s Banking Protocol Helps Stop $44M in Scam Attempts in First Half of ’21