What is the bank's liability under APP fraud reimbursement rules?
In the UK, new mandatory APP reimbursement rules require most banks and payment firms to reimburse victims of authorised push payment fraud up to £85,000 per claim, with limited exceptions — similar rules are developing in other countries.
Last reviewed: 10 June 2026
Explanation
Authorised Push Payment (APP) fraud occurs when a victim is tricked into sending money to a scammer — for example, through an impersonation scam, a fake investment, or a purchase that never arrives. Unlike card fraud, the victim technically 'authorised' the payment, which historically made recovery much harder.
In the UK, the Payment Systems Regulator introduced mandatory APP fraud reimbursement requirements effective from October 2024, applicable to Faster Payments transactions. Banks and payment service providers must reimburse victims up to £85,000 per claim. There are exceptions: victims who acted with 'gross negligence', ignored clear fraud warnings, or were involved in the fraud themselves may not qualify. Vulnerable consumers receive additional protections.
Banks also have a 'sending bank' and 'receiving bank' split responsibility — both institutions share in the reimbursement obligation. If your bank is reluctant to reimburse, cite the PSR rules specifically and escalate to the Financial Ombudsman Service if needed.
This is general information only and does not constitute personalised legal or financial advice. Rules differ by payment type, jurisdiction, and the specific facts of your case. Consulting your bank's complaints process and the FOS is the recommended path.
Common red flags
- Your bank does not acknowledge the APP fraud reimbursement scheme
- Bank claims you showed 'gross negligence' without providing evidence
- Scammer's account was at the same bank and no Confirmation of Payee warning was shown
- Payment was made via a method not covered by the scheme (e.g., CHAPS, international wire)
- Bank delays beyond the 35 business day decision window
What to do now
- Report the fraud to your bank immediately and request a claim under APP fraud reimbursement rules
- Ask your bank to cite the specific exception if they refuse reimbursement
- Lodge a formal complaint if the bank does not respond within 35 business days
- Escalate to the Financial Ombudsman Service if unsatisfied with the bank's decision
- Report to Action Fraud (UK) or your national fraud authority for a crime reference number
- Keep all records of the fraudulent communication that induced you to make the payment
Frequently asked questions
Does the APP reimbursement rule apply to all UK banks?
The mandatory PSR rules apply to payment service providers participating in Faster Payments. Some smaller institutions may operate under slightly different timescales during transitional periods. Check with your specific bank whether they are covered.
What if my bank says I ignored a warning and therefore I am not eligible?
Banks must show that a clear, proportionate fraud warning was given and that you consciously disregarded it. A generic warning buried in small print is unlikely to constitute 'gross negligence'. Challenge the bank's reasoning in writing and escalate to the FOS if you believe the refusal is wrong.