For many years, protection against unauthorised bank fraud has been a cornerstone of UK banking. If someone makes a payment from your account without your knowledge or authorisation, you’ll very likely get your money back in a timely manner. The system works well, and consumers have come to rely on this safety net.
However, one of the biggest concerns with bank transfers over the years has been the possibility of people sending cash to scammers themselves. This doesn’t fall within the same remit as unauthorised fraud, because the payments have been authorised by the account holder, despite still being a scam. Hundreds of millions of pounds are lost to this type of fraud every year, but whether refunds were given or not used to be entirely voluntary on the bank’s part.
That’s all changed with new rules directly targeting APP (Authorised Push Payment), where people send the money themselves. This finally tackles a problem that has plagued bank transfers since the very beginning, bringing much-needed protection to an area that was heavily targeted by fraudsters.
Mandatory Reimbursements When Tricked
Rules introduced in October 2024 now require refunds to be given when you’ve been tricked into sending money via bank transfer using the Faster Payments or CHAPS systems. This covers the full spectrum of cruel scams, including impersonation fraud where criminals pose as someone credible, and romance scams where fraudsters prey on people’s emotions to steal their savings.
The scheme is designed to refund up to £85,000 per case, which covers 99% of all previous fraud claims. For the rare instances where losses exceed this amount, victims can raise claims up to a maximum of £430,000 with the Financial Ombudsman Service.
The protection extends to individuals, micro-enterprises, and charities, and applies to most payment service providers across the UK. This includes all the major high street banks and smaller financial firms, though it excludes credit unions, municipal banks, and national savings banks.
When reimbursement is required, the financial burden is split between the sending and receiving payment firms. This creates powerful incentives for both sides to actively prevent fraud before it happens, rather than simply dealing with the aftermath. Early results are promising, with The Guardian reporting a 20% drop in these types of scams, with the decrease thought to be influenced in part by these new protective measures.
What to Do if You’ve Been Scammed
If you suspect you’ve been scammed, contact your bank or financial institution immediately. Whilst any instances that occurred within the past 13 months will be considered, notifying them as early as possible is crucial for a swift resolution.
Your bank will ask for detailed information about the incident and may report the fraud to the police if you haven’t already done so. The aim is for successful claims to be reimbursed within just 5 business days. However, given that these cases can be complex and require thorough investigation, banks can apply for an extension of up to 35 business days (7 full weeks) to make their final decision.
If you’re unhappy with your bank’s response or feel they haven’t handled your case appropriately, you can escalate the matter to the Financial Ombudsman Service for an independent review.
Don’t Drop Your Guard
Whilst these new rules provide substantial protection, you won’t be able to get your money back if you’re found to have been grossly negligent. Admittedly, the bar for this is set quite high and doesn’t apply to people who are considered vulnerable, but it serves as an important reminder that these new rules aren’t an excuse to let your guard down.
It remains vital to check whether the products you buy and websites you use are credible and legitimate. This is especially important as bank transfers become increasingly popular across various sectors.
A good example is online gambling, where the number of UK players using bank transfer payments is on the rise. However, many unlicensed casinos operate illegally in the UK and aren’t credible or safe. Therefore, it’s important for players to choose online casinos that both accept bank transfer and hold a proper UK licence, such as all those listed on Bank Transfer Casino UK.
Additional protective mechanisms are also in place to help safeguard your money. For example, Confirmation of Payee asks you to enter the name of the recipient, which is then checked against the account number to ensure they match. This simple but effective system helps verify you’re sending money to the right person or business.
Of course, all the usual guidelines still apply. Take time to think before making any large or new transfers, and be extremely wary of anyone trying to rush you into making a transaction. Classic warning signs include urgent messages claiming your account has been compromised and you need to send money or codes immediately to secure it.
What These Rules Don’t Cover
It’s important to understand that unauthorised fraud, such as when someone steals your card details and makes transactions without your knowledge, isn’t covered by this particular scheme. However, that type of fraud already has robust protection under existing regulations.
These new rules also don’t apply to civil disputes with legitimate businesses. For instance, if you pay a credible company for a product that arrives broken or never arrives at all, that’s not the same as being deliberately defrauded. In these situations, there was no intention to deceive you from the outset. For such cases, you can refer to the Consumer Rights Act, which ensures many consumer protections are available for faulty goods and services.
A New Era of Bank Transfer Security
Thanks to the new APP rules, bank transfers now offer comprehensive protection. UK consumers have robust safeguards in place to help combat many different types of scams and fraudulent activity.
This development couldn’t have come at a more crucial time. As bank transfers become increasingly popular for paying online, these protections help ensure that this convenient payment method is also a safe one. The new regulations bring bank transfer security in line with other payment types, giving consumers the confidence to use it without the fear that previously accompanied it.
Disclaimer: This article mentions the use of online gambling in relation to money transfer payments. It is for informational purposes only. It does not constitute legal, financial, or gambling advice. Online gambling carries risks, and you should only participate if you are over the legal age in your jurisdiction. Always gamble responsibly and within your means. If you or someone you know is experiencing problems with gambling, seek help from a professional support service such as GamCare or BeGambleAware.