Martin Lewis' MSE warns new rule will cost Barclays, Halifax, NatWest, Santander customers £100

The BBC and ITV star's team at MSE says if you're scammed into making a bank transfer to a fraudster, your bank MUST now refund you in most cases.

Banks MUST now refund some scam victims, Martin Lewis' Money Saving Expert has revealed. The BBC and ITV star's team at MSE says if you're scammed into making a bank transfer to a fraudster, your bank MUST now refund you in most cases.

It comes under new industry-wide rules which came into force on Monday 7 October. MSE explained: "But you still need to be cautious when making payments, as you may have up to £100 deducted from your refund – and banks will be able to reject claims entirely if they find you were really careless."

The new rules only cover scams where you've sent the money by UK bank transfer, either by Faster Payments or CHAPS. Other payment types, including card, cash and cheque AREN'T covered. MSE said: "Under the rules, firms have the option to charge an excess of up to £100 on each claim. This means they can choose to withhold up to the first £100 lost."

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MSE asked all the major banks whether they would charge an excess. The banks who WON'T charge any excess are Nationwide, TSB and Virgin Money. But the banks which MAY charge £100 excess include Bank of Scotland, Barclays, Chase, Co-op Bank, First Direct, Halifax, HSBC, Lloyds, Metro, Monzo, NatWest, RBS and Santander.

These banks said they would charge a £100 excess in some circumstances, but wouldn't provide specific examples. Instead, they'll assess claims on a case-by-case basis. Another which MAY charge a £50 excess includes Starling.

The PSR said: "This was a carefully balanced decision – which provides significant protection to fraud victims and strikes an appropriate balance having regard to the PSR’s innovation and competition objectives and making sure that payment systems work well for everyone."

Rocio Concha, director of policy and advocacy at Which? says the move has "shamefully sidelined scam victims". They also noted that the move puts more Brits at "greater risk" of being targetted by criminals as it "reduces the incentives for banks and payments firms to take fraud prevention seriously".

They added: "The regulator has shamefully sidelined scam victims, despite the evidence showing that this decision could have a negative financial and psychological impact on them. Instead, it caved into a lobbying campaign from some firms in the payments industry, some of which have already been warned by the FCA for their role in facilitating fraud."