Which? and Britain’s biggest banks urge Pay.UK to back vital scams reimbursement funding proposal

Which? and UK Finance, on behalf of seven payment service providers, are today urging Pay.UK to back a vital scams reimbursement funding proposal – or risk seeing a return within weeks to blameless scam victims losing their life savings.

In a joint letter, Britain’s biggest consumer organisation and the financial services trade body, acting on behalf of seven providers, call for payments authority Pay.UK to approve a plan that would ensure bank transfer fraud victims get their money back in the ‘no blame scenario’ – when both they and their payment service provider has done everything expected of them under the voluntary Code. Crucially, the pot would also cover vulnerable customers, ensuring their losses are covered.

The final decision sits with Pay.UK, which now has the important task of either ensuring the favoured industry and consumer group proposaal is agreed, or making a decision that risks blameless scam victims being left unprotected from 1 January.

The proposal – for banks to pay a small fee on some transfers to collectively fund a ‘no-blame’ reimbursement pot – was agreed and submitted following months of talks involving banks and consumer representatives.

Losses to these authorised push payment (APP) scams rose to £147 million in the first six months of this year.

In their letter, Which? chief executive Anabel Hoult and Stephen Jones, chief executive of UK Finance, warn: “Authorised Push Payment (APP) fraud is a crime which can have a devastating impact on its victims, which is why protecting consumers is a priority for us all.”

The proposal set out…will provide a long-term, sustainable funding system for the reimbursement of victims of APP scams under the voluntary Code in situations where both the customer and payment service provider have done everything expected of them, known as a ‘no blame’ situation.

“If the Pay.UK board fails to pass the Change Request, many victims of APP scams could once again risk losing their life savings to this devastating crime.”

Which? first highlighted the devastating impact of bank transfer fraud in a super-complaint three years ago and has fought tirelessly for better protections for consumers – leading to the introduction of a landmark voluntary banking industry code in May following joint work between the industry and consumer groups. 

Since then, the UK’s biggest banks have taken on the burden of funding reimbursement for victims in the ‘no-blame’ scenario. But this arrangement is due to run out at the end of the year. 

With time running out to agree the long-term solution, Which? and UK Finance, on behalf of seven payment service providers, are concerned that a rejection of the plan submitted to Pay.UK risks bringing back the threat of these losses for thousands of consumers who should be protected. 

Which? believes it is important for the scheme to be collectively funded by the industry to give all firms an incentive to individually and collectively work to prevent scams from happening in the first place.

Pay.UK’s decision is expected to be made public in November – just a month before the current interim funding deal expires.


Anabel Hoult, Chief Executive, Which?, said:

“Great strides have been made towards offering consumers greater protection against bank transfer scams – and we believe this proposal is the best way of ensuring blameless fraud victims will continue to be reimbursed.

“Time is running out to agree a solution, so we urge Pay.UK to accept this important proposal – as it is unthinkable that we could see a return to the dark days of blameless victims losing their life savings to this devastating crime.”


Stephen Jones, Chief Executive of UK Finance, said:

“Protecting customers from fraud is a priority for the finance industry. The proposal by seven payment service providers of a per-transaction fee on certain Faster Payments would offer a long-term, sustainable funding system for reimbursing victims of APP scams where both the customer and payment service provider have done everything expected of them.

 “Yet even when a customer is reimbursed, the money stolen still ends up in the pockets of organised criminal gangs involved in drugs, arms and human trafficking. That is why the finance industry remains focused on stopping fraud occurring in the first place and helping law enforcement to apprehend and disrupt those responsible. Criminals continue to exploit vulnerabilities outside of the finance industry, such as third-party data breaches, so it is important that all sectors take responsibility for tackling fraud and support victims.”

Notes to editors


The Pay.UK consultation closed on October 1st and a decision will be made in November.


The current interim funding model expires on 31st December 2019.


UK Finance wrote on behalf of HSBC, Santander, Barclays, Lloyds, Metro, Nationwide and RBS.


The proposal set out in Pay.UK’s Faster Payment Scheme (FPS) Change Request would see a 2.9p levy applied to some types of faster payment. 


The proposal is proportionate to payment providers of different sizes, consistent with the APP Scams Steering Group proposals, and widely supported by consumer bodies and industry.


Case Study, Veenita Flyn, 44 Rayleigh, Essex, said:

One such victim who received reimbursement under the no-blame ruling is Veenita Flynn. Ms Flynn used a holiday booking website to look for accommodation for a family trip. After exchanging emails and transferring £4,600 via a listing online she contacted the website and discovered the listing was fraudulent and had subsequently been removed. Ms Flynn contacted her bank First Direct and after an investigation was reimbursed the full amount.


Veenita Flynn, said:

“To discover I’d lost thousands of pounds to a scam when I thought I was booking a family holiday was really traumatic and so stressful for my husband and I.


“I thought the money was gone forever, until I read about the new banking code online. After approaching my bank explaining I’d done all sorts of checks before sending the funds and had used a trusted website I received my money back in full following a short investigation.


“It’s vital others like me are treated the same way and that money is available to support victims through this terrible crime. It can happen to anyone.”