As a merchant using Rvvup’s Pay by Bank service, it’s important to stay informed about the evolving landscape of payment security, especially concerning Authorised Push Payment (APP) fraud. From 7th October 2024, new rules are coming into force to protect consumers from APP fraud and ensure a fair reimbursement process for victims. This article provides an overview of the APP fraud reimbursement programme.
What is APP Fraud?
APP fraud occurs when a customer is tricked into authorising a payment to a fraudulent account. This type of fraud is increasingly common, and the new rules are designed to protect consumers by ensuring that payments lost to scams are reimbursed swiftly.
What’s Changing and When?
From 7th October 2024 new rules will be enforced that shift responsibility in APP fraud cases. The Payment Systems Regulator (PSR) has introduced measures requiring banks to reimburse victims of APP fraud in most cases, unless the customer has been grossly negligent. This is a significant step in increasing consumer confidence in digital payments, including Pay by Bank solutions.
What Does This Mean for Rvvup Merchants?
As a merchant accepting Pay by Bank payments through Rvvup, if a customer claims to be a victim of APP fraud for a payment you have received, Rvvup will manage the investigation. We will work closely with our partners, the account provider, and the sender’s bank to determine the validity of the claim, requesting further information from you if needed.
The sender's bank (the bank where the fraudulent payment originated) plays a crucial role in determining whether the fraud claim is legitimate. As a merchant, you should be aware that if the claim is upheld, you may be ultimately responsible for the reimbursable amount. This will typically be 50% of the value of the claim, noting that the senders bank will reimburse the other 50% as per the regulatory requirements.
What Should You Do Now?
To ensure compliance and mitigate the impact of potential APP Fraud claims:
- Keep Thorough Records: Maintain accurate records of all transactions and customer interactions, as you most likely do today.
- Respond Promptly: Ensure timely responses to any requests for information (details and evidence) during investigations on claims, where you believe a claim may not be reimbursable under APP Fraud rules. Please note, timelines will be prompt due to the window the regulator has provided to challenge claims.
By staying informed and engaged with these processes, you’ll help secure your transactions and protect your business from fraud-related risks.
If you have any questions about how the new APP fraud reimbursement rules might impact your business, we’ll be adding more information to our help centre and blog content as this evolves. Any other questions, feel free to reach out to our support team.