HSBC, First Direct, Lloyds, Halifax and more introduce new £100 fee

Big banks including HSBC and Lloyds have brought in a new £100 fee for fraud compensation

Banks, including Nationwide and RBS, have introduced a new £100 fee following a significant rule change. The new regulations, implemented earlier this week, mandate banks to reimburse victims of authorised push payment (APP) fraud.

Although the rules set a reimbursement limit of £85,000, banks can opt to exceed this and repay larger amounts. However, banks now have the authority to levy a £100 excess fee when settling claims, a policy that five banks have already adopted.

Consequently, if your claim is for a payment of £100 or less, attempting to reclaim the money may not be worthwhile. Vulnerable consumers will be exempt from excess fees, as per guidelines from the Payment Systems Regulator.

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The five banks implementing this fee are HSBC, First Direct, Lloyds, Halifax, and Bank of Scotland. An HSBC spokesperson told The Sun: "All of us have a role to play in preventing fraud and scams - we want to encourage customer caution, particularly when it comes to lower value purchases made online."

The Sun has reached out to the other mentioned banks for comment and will update readers with any further responses.

Liz Edwards, a money expert at Finder, previously told The Sun: "£100 is a lot of money to many people. Based on 2023 fraud figures, more than 58,000 cases would have resulted in no refund if all companies had applied the excess, and now only four of the major providers have confirmed they won't."

Some banks have suggested they 'may' impose an excess or evaluate claims individually.

Take Starling Bank, for instance, which has indicated it might enforce a £50 excess rather than the typical £100.

Meanwhile, a Natwest spokesperson made it clear they would consider each claimant on an individual basis, taking into account their particular situation.

To sidestep these potential charges, customers can switch to one of the four banks that have committed to waiving such fees.

In this vein, Nationwide, Virgin Money, TSB, and AIB have expressed they won't be implementing the excess charge.

A representative from Virgin Media reassured: "Where customer circumstances result in a reimbursement under the rules, we are not planning to apply the voluntary excess, and this includes claims under £100."

TSB likewise emphasised a commitment to fraud protection. They remarked: "Charging £100 could exclude a third of all victims from claiming refunds and it's not right to penalise people for scams that take place largely due to weaknesses on social media platforms."

Last year witnessed 232,429 APP (Authorised Push Payment) fraud incidents in Britain - marking a 12% increase from the previous year.

A staggering £459.70 million was scammed in 2023 alone, thanks to this kind of con.

Moreover, two-thirds of the entire APP fraud cases in 2023 were attributed to purchase scams. These occur when individuals pay for items or services that they never receive, often initiated through purchases made over social media, where more than three-quarters of authorised fraud begins.

Banks like TSB are keen to stress that these scams are not the fault of the customer, while HSBC suggests that by implementing the excess it will encourage shoppers to be more vigilant.

Shoppers are now being advised to be extra cautious of suspicious deals when shopping online.