The Payment Systems Regulator (PSR) is proposing to direct banks and other payment firms participating in CHAPS1 to reimburse their customers who have been victims of authorised push payment (APP) scams. The PSR’s direction will underpin the Bank of England’s new CHAPS reimbursement rules.  

In June 2023, the PSR published its policy requiring payment firms to reimburse APP scam victims who lose money through transactions over the Faster Payment System (FPS) – the system over which the majority of these scams happen. These FPS protections, which come into effect from 7 October 2024, mark a step change in the culture of payments to improve scam prevention and focus firms on protecting people.   

However, criminals operate across multiple payment systems and in December 2023, the PSR said it would support the Bank of England as it introduces similar requirements for CHAPS. This means consumers will benefit from consistent protection across two major UK payment systems and more payment firms will be incentivised to tackle scams, reducing the likelihood of criminals switching from FPS to CHAPS due to differences in firms’ defences.  

The PSR has made its approach to CHAPS as similar as possible to its approach to FPS to reduce unnecessary duplication of work for directed payment firms while ensuring a high level of protection in both systems.  

Kate Fitzgerald, the PSR’s Head of Policy, said:  

“It is important that we make it harder for fraudsters to operate. Providing consistent incentives across payment systems is a crucial step in ensuring everyone does their best to tackle scams.”  

“The action we’re taking on APP scams is world-leading. It will help to close existing gaps and to make sure more payment firms across systems are incentivised to prevent scams from happening in the first place, while protecting those who do fall victim.” 

What happens next? 

After the PSR has considered the responses to this consultation, it expects to finalise and publish the specific direction in September 2024. The PSR is proposing 7 October as the go-live date; the same as the FPS reimbursement policy, meaning APP scam victims will get the same protection across both payment systems.  

The lead up to 7 October go-live date 

Industry should already be preparing to implement the reimbursement requirement, and collaboration in these coming months will be important to achieve effective implementation. The PSR is working closely with Pay.UK, payment firms and trade bodies to ensure preparedness and timely implementation.  


Notes to editors:  

1. CHAPS is the UK’s real-time, high-value sterling payment system. The Bank of England is the operator of CHAPS. The Bank does not fall within the scope of the PSR’s regulatory powers, however, the PSR continues to regulate the remaining participants in the CHAPS payment system.  

2. The Bank’s draft CHAPS reimbursement rules have also been published alongside this consultation. They can be found at the bottom of our webpage.  

3. This consultation closes on 31 May 2024.  

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