The UK's largest banks have committed to extend funding to reimburse customers who fall victim to authorised push payment fraud by three months, pushing the expiry date for the interim arrangement from December to March 2020.
The move follows a rejection by Pay.UK of proposals from the banks to levy a per transaction fee for certain Faster Payment transactions as a means to provide a long-term, sustainable funding arrangement.
The decision was prompted by an industry-wide consultation which found "no industry consensus" to finance a central fund to reimburse innocent victims of APP fraud.
The banks say they have agreed to continue the funding deadline to allow more time to consider Pay.UK’s alternative recommendations on long-term funding arrangements. Critically, they are keen on a move to legal redress that takes in to account the responsibilities that organisations outside the finance sector have in tackling fraud.
Stephen Jones, chief executive of UK Finance says: “There is strong agreement across the banking and payments sector that we, alongside third-party organisations who hold consumer data, must all work together to create a long-term, sustainable funding solution to compensate the victims of scams in ‘no blame’ situations.
“UK Finance shares the Treasury Committee and Which? view that issues of liability and reimbursement should best be addressed by new laws rather than just a voluntary Code alone and will continue to call for new legislation to make the Code mandatory to ensure that victims are protected and reimbursed. We urge any future government to work together with the Payment Systems Regulator to make this happen.”