Although real-time payments have been available in the UK for some time, adoption has been slower compared to many other parts of the world, likely due to security concerns.
A study conducted by FICO found that while 79% of UK consumers surveyed have used real-time payments, this lags behind the 14-country average of 91%. Additionally, while nearly half of global RTP users plan to increase their usage in the next 12 months, only 28% of UK consumers intend to do the same.
Security perceptions also play a role in adoption. While roughly a third of UK consumers consider RTP to be more secure than credit cards, the global average stands at around 50%.
Holding Banks Responsible
Awareness of fraudulent schemes runs high in the UK. Seven out of every 10 consumers report receiving an unsolicited text, email, or phone call they believed to be part of a scam.
Consumers have increasingly turned to their banks for help in fighting payment fraud. Last October, the UK passed regulations requiring banks and other payment firms to reimburse victims of authorized push payment (APP) fraud, in which individuals are deceived into sending money to criminals. These crimes are especially dangerous for RTP consumers, as funds sent via real-time payments can be difficult to recover.
Under the new rule, banks must refund customers who are not at fault within five business days, with a reimbursement limit set at £85,000. This applies to payments made through the UK’s Faster Payments service, commonly used for mobile and online banking, as well as the CHAPS payment system, typically used for higher-value transactions like real estate.
Looking for Banks to Take the Lead
The UK has also adopted an account name verification service called Confirmation of Payee, which requires receiving institutions to validate account names before any payment is initiated.
According to the FICO survey, UK consumers welcome this kind of intervention. Three-quarters of respondents believed that banks should refund scam victims always or most of the time. More than half also stated that deploying better fraud detection systems is the most or second-most impactful action their banks can take to protect them from scams.
