What is APP Fraud?

Authorised Push Payment Fraud (APP Fraud) is an industry term for where you authorise the sending of a payment and the person receiving it is not who you intended to pay, or the payment is not for the purpose you intended. At PayPal, we sometimes refer to this as a “scam” and to the fraudsters as “scammers”.

What are the rules around APP Fraud?

On 7 October 2024, new rules came into force that protect payments made by individuals, micro-enterprises or small charities involving APP Fraud where these are made through the Faster Payments or CHAPS systems. We refer to these as the APP Fraud Rules. Under the APP Fraud Rules, you may be entitled to be refunded for money you have lost due to APP Fraud on or after 7 October 2024, up to a maximum of £85,000 per claim.

PayPal uses Faster Payments and CHAPS in limited circumstances to send money from your PayPal account to your bank account. Faster Payments or CHAPS systems are not used for other PayPal payments, including where you send money from a PayPal account to another PayPal account or where you pay a business at checkout using PayPal.

Many scammers now ask for payments to be sent through peer-to-peer payment services, for example from your PayPal account to another PayPal account. You are not entitled to be refunded under the APP Fraud Rules in these circumstances.

Will I be refunded for APP Fraud scams?

The APP Fraud Rules apply where: 

• You are an individual, micro-enterprise or small charity and you made a payment using the Faster Payments or CHAPs systems. At PayPal, this means you withdrew money from your PayPal account to a bank account,
• The payment was subject to an APP Fraud (as summarized above),
• The payment was executed in the UK and received by a UK bank account, and
• The payment was made on or after 7 October 2024.

There are some circumstances where you may not be entitled to a refund under the APP Fraud Rules including where:

• You are not an individual, micro-enterprise or small charity and/or the fraud does not meet the definition of an APP Fraud (as summarized above).
• You have acted fraudulently or dishonestly in bringing the claim and/or are party to the APP Fraud.
• You have not complied with the consumer standard of caution, meaning you have acted with a significant degree of carelessness. For example:

• You ignored specific warnings from us about the payment you made.
• You did not notify us of the APP Fraud promptly or, in any event, within 13 months of the most recent payment.
• You did not respond to our reasonable requests for information about the APP Fraud.
• You refuse to report or allow us to report the APP Fraud to the police.

We will not expect you to meet the consumer standard of caution where your personal circumstances would materially impact your ability to comply.

How do I report an APP Fraud withdrawal scam?

If you have sent money from your PayPal account to a bank account and believe you have been the victim of an APP Fraud, please submit a claim by contacting PayPal customer service team. You can reach us by clicking Contact Us.

We will usually make a decision within 5 business days of your claim.  We may take longer if we need more information from you and/or the bank that received the APP Fraud payment. In all cases, we will make a decision within 35 business days of your claim. 

If you are dissatisfied with our decision, you can use our existing complaints process to let us know and we'll do our best to fix things quickly and fairly.

Please note that if you have sent money from a bank account to a PayPal account and believe you have been the victim of an APP Fraud, please contact the bank that sent the payment, and PayPal will work directly with them to resolve.

What PayPal payments are not covered by the PSR APP Fraud rules?

The APP Fraud Rules do not apply to other PayPal payments including:

• Sending a friends and family payment from your PayPal account to another PayPal account,
• Sending a goods and services payment from your PayPal account to another PayPal account, or
• Paying a business at checkout with PayPal.

In cases involving paying a business at checkout or sending money as a goods and services payment from your PayPal account to another PayPal account, you may be eligible for a refund under PayPal Buyer Protection.

Where you send money from your PayPal account to another PayPal account as a friends and family payment, you are not entitled to be refunded under the APP Fraud Rules or the Buyer Protection Program.

Refer to What are ‘Friends and Family’ payment scams for more information.

Is my payment covered by PayPal Buyer Protection?

You may be entitled to a refund under Buyer Protection if the payment related to:

• Goods that did not arrive,
• Charges for the wrong item, or
• Goods that do not match the description or arrive damaged.

We review each case and if we decide the claim in your favour, we will reimburse you.

Some payments that are not eligible for Buyer Protection include:

• Sending money (a friends and family payment),
• Prepaid cards,
• Motor vehicles,
• Investment purchases,
• Real estate,
• Wholly or partly custom-made items, and
• Cryptocurrency.

Visit What is purchase protection for buyers and how does it work? for additional information on terms and exclusions.

Where can I find more information about scams and protecting myself?

Visit our Security Centre to learn more about scams, including the steps we take to protect you and advice on how you can improve your own security.