Global: PSR Urges Cross-Industry Data Sharing to Tackle APP Fraud

Authorised Push Payment (APP) fraud occurs when individuals are deceived into transferring money to fraudsters who impersonate legitimate entities. In 2023, APP scams inflicted a financial loss of £341 million on UK consumers, according to data from the Payment Systems Regulator (PSR).

The impact extends beyond financial loss, eroding public trust. While only 10% of victims reported losing trust in their banks, a striking 41% expressed diminished confidence in social media companies and other platforms used by fraudsters to initiate scams.

A Call for Collaboration

The PSR underscores the need for collective action to address vulnerabilities across industries. While recent rules on reimbursing victims aim to incentivize banks to prevent fraud, the regulator highlights that social media, telecoms, and online platforms must also take responsibility.

“Fraudsters exploit major platforms to deceive victims, often with devastating effects,” said Kate Fitzgerald, the PSR’s head of policy. “By publishing this data, we aim to drive real change across industries, tackling the root causes of APP scams. Preventing scams before they happen is the best way to protect consumers and reduce harm.”

The PSR is advocating for enhanced collaboration between technology, telecom, and payment providers to close security gaps exploited by scammers. Greater data sharing and joint efforts, the regulator believes, are crucial to combating fraud at its source.

Shifting Fraud Tactics

As banks strengthen their defenses, scammers are adapting. Nick Perkins, NatWest’s director of fraud prevention, observed a shift in fraud patterns following new APP fraud reimbursement rules.

“We’re seeing a move from high-value fraud to high-volume, low-value scams, as well as a displacement into card fraud,” Perkins noted. “Every time you close one gap, new ones appear.”

This shift underscores the unintended consequences of heightened protections against APP fraud. Claire Simpson, senior policy manager at the PSR, emphasized that while the policy was designed to make APP fraud harder to execute, it has inadvertently driven scammers to target other payment systems.

The Road Ahead

The PSR sees these challenges as a reminder of the need for ongoing vigilance and collaboration. Tackling fraud requires more than isolated efforts—it demands a unified, cross-sector approach.

“This is a progressive step in combating fraud, but it’s just one piece of a larger puzzle,” Perkins said, highlighting the importance of continued innovation and collaboration in fraud prevention.

By fostering greater data sharing and accountability among banks, social media companies, telecom firms, and payment platforms, the PSR aims to address scams earlier in their lifecycle, ensuring better protection for consumers and a more resilient financial ecosystem.