New rules mean that bank customers are now protected for up to £85,000 worth of money lost to fraud – here’s how the regulations may protect you.
What are the new rules?
From October 7, this year, banks and other payment service providers must refund you if you accidentally make a fraudulent transfer – although any payments made before this date aren’t covered.
The news rules apply to authorised push payments (APP) which is usually you pay through your mobile banking app or logging into your account online through a computer.
APP fraud can come in all sorts of forms such as purchase scams, where you are pushed into paying for products that don’t exist; romance scams which use fake profiles to trick victims into relationships to coerce them into sending money; and investment scams where people are tricked into sending money for a scheme that doesn’t exist.
Payment types covered by the new rules only includes money sent by UK bank transfer, while other payments like cheques, cards and cash are still unprotected.
All banks are part of the new scheme and building societies and e-money companies such as prepaid card providers and savings providers are also supported.
Does it mean I can claim back more than £85,000?
Although this offers newfound protection to victims, there is a limit of £85,000 on repayments.
However, individual payment providers may choose to pay more than that depending on the specific case.
The Payment Systems Regulator (PSR) says the £85,000 limit will cover 99.8% of all scam cases.
The limit was brought down from an initial sum of £415,000 after lobbying from the payments industry.
How does the claim system work?
If you make a claim you can expect money to be refunded back to your account within five working days, a more complex case can take up to 35 days for banks to investigate further.
However, your claim may be rejected if it can be proved you acted with a “significant degree of carelessness”, although according to the Payment Systems Regulator (PSR), the body behind the new rules, this should only affect “a small number of cases”.
Although the rules offer more protection, firms are allowed to charge a £100 excess fee on each claim.
Nationwide, TSB and Virgin Money will not charge any excess, while the Bank of Scotland, Barclays, Chase, Co-op Bank, First Direct, Halifax, HSBC, Lloyds, Metro, Monzo, NatWest, RBS and Santander may choose to take £100.
The banks who may choose to charge the excess have said that they’ll assess claims on a case-by-case basis.
An HSBC UK spokesperson told The Mirror: “All of us have a role to play in preventing fraud and scams.
“We want to encourage customer caution, particularly when it comes to lower value purchases made online.
“This is why we will be applying the excess to the total amount reimbursed to customers, while taking into account the specific circumstances of each customer where appropriate.”
Special protections for vulnerable customers.
There are protections for those deemed vulnerable, who won’t have to pay the £100 fee, as they aren’t expected to meet “the expected standards of carefulness from those who aren’t vulnerable”, according to Money Saving Expert.
A vulnerable person is defined as “someone who, due to their personal circumstances, is especially susceptible to harm – particularly when a firm is not acting with appropriate levels of care”.
What is my claim is rejected?
If you believe that the bank has unfairly rejected your claim you can raise a formal complaint, if necessary you can also escalate the complaint to the independent Financial Ombudsman Service.
How can National Fraud Helpline help?
We can make the claim on your behalf to present the best possible case. We have a no win, no fee service and charge 15% plus VAT. It means you only pay us if we get your money back.
If you have lost money to a scam fill out our enquiry form or contact us on 0333 0033218