NatWest introduces daily transfer limits to tackle fraud

NatWest is to enable customers to set daily bank transfer limits to help protect customers against fraud.

The bank hopes the move, first reported by Which? Money, will reduce authorised push payment (APP) scams where victims are tricked into transferring money into a criminal account.

The number of reported APP scams rose by 22 per cent last year, with scammers stealing £479 million, an increase of 5 per cent on the previous year.

NatWest, Royal Bank of Scotland, and Ulster bank currently have a default bank transfer limit of £20,000 per day, which will be reduced to £5,000 per day.

Customers will be able to change the daily transfer limit on their online accounts, making it higher or lower than the £5,000 limit. The limit applies to digital payments only, not transfers requested by phone or in branch.

NatWest Group said that 95 per cent of its customers have never paid someone else more than £5,000.

Which? asked the largest current account providers if they plan to follow NatWest’s lead and allow customers to set their own caps.

Nationwide and Virgin Money said they are considering following suit. But Barclays, HSBC, Lloyds Banking Group, Metro Bank, Santander, Starling, The Co-operative Bank, and TSB, said they had no current plans to introduce a daily transfer limit.

Barclays said that payment limits are assessed regularly but for now customers can only set their own daily ATM limit and spending limits on their cards.

HSBC also said that payment limits are routinely reviewed.

TSB said it hasn’t seen customer demand for flexible transfer limits but will keep its approach under review.

Metro Bank said is it continuing to explore the possibility of transfer limits.

Starling told Which? that it’s “not convinced by the protection it would provide” but said it is exploring a new approach to managing payment limits, using data to identify unusual payments.

“We want to be able to assess individual payments that are out of character relative to the customer’s payment habits,” the challenger bank said. “We are in the process of building and implementing a solution that will look at the payment in context of the customer’s account, the reason for payment and their relationship/history with the destination of the funds, to determine if we need more information before the payment can be released."

Which? explained that it is still yet to be seen if customer-controlled transfer limits become an important anti-fraud measure.

But limits do give customers more control over their own normal behaviour and act as another layer of friction.

A NatWest spokesperson said: “It also helps in a situation where a fraudster has taken control of a customer’s account as without the card reader they would not be able to increase the daily transfer limit.”

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