On 9 October 2024, there was published on legislation.gov.uk, The Payment Services (Amendment) Regulations 2024 together with an explanatory memorandum.
The Regulations come into force on 30 October 2024.
The Regulations introduce the ability for payment service providers to slow down the sending of an in-scope payment where the payer’s payment service provider has established that there are reasonable grounds to suspect the payment order has been placed subject to fraud or dishonesty by someone other than the payer. This is permitted where the grounds have been established by the end of D+1, and where
more time is needed for the payment service provider to conduct further enquires with the customer or a relevant third party. The delay to the payment must be no longer than necessary and, in any event, no longer than the end of D+4. This gives a payment service provider more time to intercept potentially fraudulent payments, interrogate them and “break the spell” of the fraudster, in individual cases. The conditionality for using this measure means it cannot be applied as a tool to ‘derisk’ whole categories of transactions where those grounds are not established.
Payment service providers will be required to inform the payment service user of the fact of the delay, the reason for it and what information or actions are needed to help the payment service provider decide whether to execute or refuse the payment order (unless providing any of that information would be unlawful). This information must be provided as soon as possible and no later than the end of D+1.
The Regulations apply only to outbound authorised push payments wholly executed in the UK in sterling. It does not apply to pull payments (i.e., those initiated by the payee such as card payments), payments as part of the Single Euro Payments Area, international payments or paper-initiated transactions.