In total, £341m was lost to APP fraud last year in just over a quarter of a million (252,626) incidents.
This is 12% lower than in 2022, according to the second annual report by the Payment Systems Regulator (PSR) into APP scams.
The scams, in which victims are conned into sending money to someone they believe is a legitimate person or business, have soared in recent years.
Despite the amount reimbursed to customers by banks growing from 61% in 2022 to 67% in 2023, it largely depends on who you bank with regarding the success of getting your money back.
The leading firm in this regard was Nationwide Building Society, which reimbursed 96% of its customers who reported an APP scam complaint, with TSB in second place with a 95% rate.
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In the third spot for refunds on the crime considered “the top threat” to businesses and customers was Barclays. The bank paid back customers who were victims of APP fraud in 82% of cases reported.
However, challenger banks and smaller firms were less giving when it came to full reimbursements. Just 3% of cases reported to AIB are fully reimbursed, and Monzo, the popular bank for travellers, fully repays just a tenth of cases.
In terms of the amount repaid to customers, TSB was the most consistent and reimbursed 88% of the total money lost by its customers to APP fraud. Nationwide was the second-highest value at 87% and HSBC was third – covering 76% of all the money lost by its customers to the scam.
It was the same case for the less generous banks, AIB Group, Danske Bank and Monzo, which covered 9%, 13% and 17% of scam losses respectively.
Smaller firms receive high proportion of scams
While the bigger banks’ refund success varies depending on the provider you have, it is customers of smaller, local firms that receive the disproportionately higher rates of scams.
In one case, Skrill, the online wallet provider, had £18,550 worth of APP scams for every £1m paid into the bank.
Compared to TSB, which had just £408 for every £1m it received, Skrill’s level is far higher.
Last year, fraud victims lost £1.2bn in total to scammers, and the report comes as the PSR deadline for receiving and sending payment service providers to reimburse customers who have fallen victim to faster payments looms.
From October, the reimbursement to pay back victims of APP fraud will be done with a 50:50 split between the sending and receiving providers.
‘Positive changes but more still to do’
David Geale, managing director of the PSR, said: “We can see some positive changes with more victims being reimbursed than in 2022. But there is still more to do – particularly for some smaller firms, which have much higher rates of receiving fraud than larger firms.
“Our new mandatory reimbursement measures will dramatically increase protection for consumers. These come into effect on 7 October 2024, and we are already seeing payment firms innovating and improving their controls, which is key to preventing scams from happening in the first place.”
Rocio Concha, Which? director of policy and advocacy, thinks that fraud victims are still facing a “reimbursement lottery” and “some firms are clearly way off the pace”.
Concha said: “The Government and the regulator have faced heavy lobbying by sections of the industry to push back against the new mandatory reimbursement scheme, which will see the vast majority of scam victims get their money back.
“Today’s figures clearly show these new rules cannot come soon enough and must not be delayed. Consumers are being targeted by highly sophisticated scams that they can often do little to protect themselves from. The UK is in desperate need of these protections, which have been years in the making and will play a vital role in the fight against fraud.”
