Payments firms are calling for a rethink of UK plans to protect victims of APP fraud, arguing that a refund cap of £415,000 will hurt smaller providers.
APP fraud has quickly become one of the most significant types of fraud in the UK, with losses totalling nearly £500 million last year. Consumer groups and politicians have been clamouring for banks to tackle a growing epidemic and to speed up the process of reimbursement for blameless victims.
From October, in what it describes as a "step-change" in fraud protection that will see the vast majority of money lost to APP frauds reimbursed to victims, the Payment Systems Regulator has set a £415,000 maximum reimbursement level.
Industry group the Payments Association has written to the Economic Secretary to the Treasury, Bim Alami, to protest the cap, calling it "simply not proportionate," according to Bloomberg.
Signed by around 30 firms, the letter argues for a cap of £30,000, which is in line with the average APP fraud loss. The letter also warns that the refund systems may not be ready by the October deadline.