Recent Changes in APP Fraud Regulations – What Banks and Fintechs Need to Know | ACI Worldwide

Fraud prevention is evolving fast, and Authorized Push Payment (APP) scams are at the center of it. In a recent discussion, Cleber Martins, a payments and fraud expert with over 24 years at ACI Worldwide, shared insights on how APP fraud is growing and what new regulations are doing to combat it.

What is APP Fraud and Why is it a Problem?

APP fraud happens when scammers trick legitimate account holders into sending money to fraudulent accounts. Unlike traditional fraud, where banks can detect unauthorized access, APP scams are harder to stop because the customer themselves initiates the transaction—often after being manipulated by fraudsters. This makes it a major challenge for banks and payment providers.

How the UK is Leading the Charge on APP Fraud Prevention

Martins highlighted the United Kingdom as a frontrunner in holding financial institutions accountable for APP fraud. While these scams often start outside banking platforms—on social media or online marketplaces—the stolen funds always move through the banking system. That’s why UK regulators are stepping in with new rules to push banks to take more responsibility for fraud prevention.

Here’s what’s changing under the UK’s new APP fraud framework:

• Banks must reimburse victims within five days.
• Both the sending and receiving banks share financial liability, meaning receiving banks—who previously weren’t responsible—must now monitor fraud more closely.
• Real-time payments are getting new security requirements to prevent fraudsters from taking advantage of instant transfers.

The Shift in Liability – What It Means for Banks

Traditionally, fraud liability sat with card issuers, thanks to well-established chargeback mechanisms. But real-time payments have never had such protections—until now. In the past, banks had no obligation to refund customers tricked into sending money to scammers.

That’s changing. Regulators are now requiring banks to verify account ownership, track suspicious activity, and invest in better fraud prevention tools. Instead of just processing transactions, banks are being forced to become active fraud defenders.

The Bigger Picture – What’s Next for Financial Services?

Martins pointed out that this regulatory shift marks a turning point in fraud prevention. Financial institutions will need to:

• Invest in better fraud detection technology.
• Improve collaboration across the industry.
• Adopt a more proactive approach to customer protection.

While the UK is leading the way, other markets are expected to follow. That means banks and fintechs worldwide should start strengthening their security frameworks now. The conversation underscored one key takeaway: industry-wide cooperation is critical to fighting financial crime effectively.

For fintech professionals, bankers, and financial services enthusiasts, staying ahead of these fraud trends and regulations is essential to navigating the future of digital payments.

Be sure to download the Scamscope report today to understand the trends, get the latest figures, and get tooled up.

Download (https://www.aciworldwide.com/scamscope-report-app-scam-trends?utm_campaign=gpe-2024-bnks-payi-global-scamscope&utm_medium=referral&utm_source=fintech-finance&utm_content=report)