Santander, Lloyds, Nationwide, Barclays customers will have payments 'delayed by four days'

New laws will extend the time that suspicious payments can be delayed by 72 hours in a bid to protect people from fraud.

Millions of bank customers could see payments delayed by up to four days in a new crackdown. New laws will extend the time that suspicious payments can be delayed by 72 hours in a bid to protect people from fraud.

Santander, Lloyds, HSBC UK, Nationwide, TSB, Barclays and Halifax are among the biggest banks in the country. Under the new powers, banks can extend the time that suspicious payments can be delayed by 72 hours, or an additional three days.

Customers will be notified by their bank about any delay, and if any interest or late payment fees are incurred as a result of the delay, they will be compensated. It comes in a bid to prevent APP fraud up and down the country.

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Authorised push payment (APP) fraud is one of the fastest growing types of scams around. It’s claimed more than £145 million was lost in the first half of this year, which is 44% higher than in the same period of last year.

Tulip Siddiq, the economic secretary to the Treasury, said: “Hundreds of millions of pounds are lost to scammers each year, targeting vulnerable communities and ruining the lives of ordinary people. We need to protect these people better, which is why we are giving banks more time to investigate suspicious payments and break the criminal spell that scammers weave.”

Rocio Concha, the director of policy and advocacy at Which? consumer group, said: "This is a positive step in the fight against fraud. While it should not affect the vast majority of everyday payments, it’s important that banks can delay a bank transfer and take action if they think a customer is being targeted by a scam.

"These measures should be used in a careful and targeted way. Financial firms of all sizes should also ensure they share intelligence and work with the police and other authorities to shut down accounts used for fraud and pursue the criminals behind them."

Ben Donaldson, UK Finance managing director of economic crime, said: "UK Finance has long called for firms to be allowed to delay payments in high-risk cases where fraud is suspected, and we are delighted to see proposed new laws supporting this.

"This could allow payment service providers time to get in touch with customers and give them the advice and support they need to avoid being coerced by the criminals who want to steal their money. This could potentially limit the psychological harms that these awful crimes can cause and stop money getting into the hands of criminals."