Santander is calling for a radical plan of action. The recommendations put forward for the banking and payments industry are:

Update payments systems to introduce new data sharing standards - Pay UK should develop new data standards to define overlay services as part of the New Payment Architecture (NPA), which is the infrastructure that will further support digital payments;

Ensure all payment providers follow a specific set of fraud rules - Confirmation of Payee (CoP) should be mandatory across all Payment Service Providers (PSPs) for all new payments; and

Provide a more tailored approach to payments - consideration should be given to whether higher-value Faster Payments require additional checks.

Recommendations for Government and other industries to implement are:

Prevent fraudsters from reaching people in the first place - the Online Safety Bill should be brought forward, and consideration should be given to linking where the scam originally started e.g. social media platform, to who is responsible for reimbursing the victim;

Greater collaboration between Law Enforcement and Industry - law enforcement must have sufficient skills and resource to adequately respond to the crime; and

Provide clear and accountable leadership - there needs to be effective and streamlined Government leadership dedicated to tackling APP fraud.

Enrique Alvarez, Head of Everyday Banking at Santander UK: “The sheer scale and value of APP fraud can detract from the real impact of these crimes on individual consumers, who can lose more than just money - their confidence and mental health can also be significantly harmed. Unfortunately, we see this far too often, and it is time for us all to act together. The criminals who perpetrate these scams shouldn’t be getting away with it.

“As our report shows, there are changes the banking industry can implement - but there are other changes that are clearly outside the banking industry’s control - like how fraudsters often reach their victims in the first place. We must all come together and address the issue, because currently the only real winners are the fraudsters.”

Santander is urging Government to be more focussed in how it deals with fraud and for a cross-Whitehall response which ensures consistency across the Home Office, the Department for Digital, Culture, Media and Sport (DCMS) and HM Treasury. It also believes it is crucial that the Government brings forward the measures proposed in the Online Safety Bill to tackle user-generated and paid for advertising used by fraudsters.

Currently, there is no consistent regulation or legislation that is applicable to all financial institutions in this space, and there is no single body centrally managing this at a ‘payment system’ level in the UK. Creating a set of specific fraud rules that PSPs must adhere to covering technical designs, policy and how to process payments to reduce fraud, should be a focus for the industry. Pay.UK should also develop new data standards to increase the safety of confirming payees and requesting payments as part of the NPA, capturing extra data in any real-time payment transaction to stop fraudulent transactions from occurring.

The report also makes it clear that big tech has a role to play in preventing fraudsters reaching consumers in the first place. Santander data shows that over 70% of purchase scams originate on social media (Facebook 54%; Instagram 15%; Snapchat 4%). Alongside this, law enforcement agencies need to allocate significantly more resources to tackling these type of scams, create consistency in how fraud is reported, as well as effectively manage how the reports are followed up. At the moment competing pressures on law enforcement means that there is insufficient resource and consideration given to this type of crime.