New research by the Payment Systems Regulator (PSR) has found that around one-third (32%) of the victims of authorised push payment (APP) fraud said they had lost confidence in using new payment methods.
The PSR’s research, conducted among more than 1,500 UK adults, revealed that nearly one in five fraud victims said their experience left them feeling anxious or depressed, while half reported their trust in others had diminished as a consequence.
The impact of fraud also goes beyond the payments sector, with 41% of fraud victims reporting a loss of trust in social media companies – four times as many as those who lost trust in traditional banks.
The PSR said the finding “reinforces” the need for online marketplaces and social media platforms to take greater responsibility for fraud prevention.
When victims were asked about their priorities, getting reimbursed emerged as the top priority, with 67% of APP fraud victims citing this.
Removing fraudulent content (19%) and investigating the fraud (7%) were further down the list of priorities.
According to the PSR, victims who are reimbursed are commonly less likely to have long-term emotional impacts.
The PSR said that its research also “challenges assumptions that reimbursement leads to complacency”, with reimbursed victims saying they felt more vigilant about fraud risks, not less.
Kate Fitzgerald, head of policy at the PSR
Kate Fitzgerald, the PSR’s head of policy, said: “This research emphasises the devastating impacts of fraud on consumers’ mental wellbeing and trust.
“APP fraud isn’t just a financial setback, it affects people’s confidence in payments and can leave them fearful of using digital platforms and retailers in the future.”
APP fraud losses exceeded £213 million in the first half of this year alone.
Fitzgerald added that with big shopping events on the horizon, such as Black Friday, it is “crucial for consumers to stay vigilant – but not fearful”.
“That’s why our new protections are so important – now, consumers can feel reassured that if they fall victim to APP fraud despite taking the right precautions, they will be able to get their money back,” she said.
The PSR’s new rules enforcing mandatory reimbursement requirements came into force on 7 October this year, under which, both sending and receiving firms share reimbursement costs equally.
Further reading: Pay.UK expands CoP to boost ‘collective defences against fraud’
