The UK's second and far more significant recent departure from the EU directive on payment services (PSD2) involves extending the time limit on processing a payment order where it's been authorised by the payer but their payment service provider (PSP) reasonably suspects that it's been initiated after fraud or dishonesty by someone else (which could include the actual payee, of course), known as 'authorised push payment (APP) fraud'. If you need any help with implementing or evaluating the impact of the new processes, including updating service terms and conditions, please let me know.
The PSP must form its suspicion and explain (if lawful to do so, and not 'tipping-off' under money laundering regulation) by the end of the next business day after receiving the payment order (the usual time limit for processing).
The PSP then has up to 3 more business days to investigate before processing (or not).
This right is limited to authorised, UK-only, GBP transactions (but not those initiated through a payee, like a direct debit).
The related policy note explains that comments are due in to the Treasury by 12 April. The goal is to bring these changes in to support the Payment Systems Regulator's rules on reimbursements for APP fraud from October.
This post is for general information purposes and is not legal advice. If you need any help with implementing or evaluating the impact of the new processes, including updating service terms and conditions, please let me know.
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