Starting 7 October, UK payments firms are now obligated to reimburse victims of authorised push payment fraud, with compensation capped at £85,000.

On the latest episode of iGaming Daily, Callum Williams and Kieran O’Connor from the Payment Expert team delved deeper into the regulations and reaction from the payments industry. 

The £85,000 cap was initially slated to be £415,000, however, backlash from the industry led to a reduction. Payments firms also called for a delay in the launch of the regulations but were unsuccessful.

On the industry response, Kieran said: “A lot of payments firms are taking the route of ‘let’s get on with it’. On the flip side, there are some who are still fighting against them. 

“The big issue that they’ve raised is how social media platforms have avoided any regulation as if someone looks to get reimbursed from fraud, it will be the receiving and sending [payment service providers] which will have to reimburse 50/50. The social media platform from which the fraud may have originated has no financial responsibility.”

In response to the growing rate of fraud perpetuated on social media, Meta, the owners of Facebook and Instagram, has expanded an information-sharing partnership with Natwest Group and Metro Bank on how to prevent fraud. 

Kieran explained that Meta’s initiative has been met with backlash from the wider payments industry with one stakeholder describing it as “baby steps, when what the industry needs are giant steps forward”.

Considering the potential impact of the regulation, the pair agreed that the new rules will improve the lives of customers who have experienced APP fraud, however, they are unlikely to have a “major effect” on the instances of fraud. 

“I think the new rules will benefit the customer because they’re being reimbursed within five days of making a successful claim and also the new rules will be covered 99% by the regulator so it gives customers peace of mind,” explained Callum.

“For companies, I can see the frustration with the new rules as there may actually be an uptick in fraud cases, especially if the fraudsters catch wind of the £85,000 cap. You are maybe [also] going to see a lot more fraudsters take advantage of this more manual processing as it takes a lot of time for these companies to manually process.

“When you take into account integrating some new digital services, anti-fraud solutions, they can also take time to integrate as well.”

After a short break, the attention turned to across the Atlantic and G2E in Las Vegas. Jessica Welman, Editor of SBC Americas, sat down with Lucía Mouriño, VP of Latin American Relationships at SBC, to recap their time at the event.

According to Jess, the word of the week at G2E was sweeps as she recounted a tense panel session on sweepstake casinos, which have come under increased scrutiny in the US.

She said: “People are very upset that the sweeps space is growing. Everybody has strong opinions and very contentious thoughts on them. There was a sweeps panel [with] two pro-sweeps [participants] and three anti-sweeps and there was a lot of contentious arguing.

“It would take 45 minutes for me to get into the weeds of the legal argument but there’s just a lot of legal minutiae on this one.”