Hogan Lovells

Recent regulatory developments focussed on the payments sector. See also our General Regulatory News of broad relevance in the Related Materials links.


  • Contactless payments: FCA PS21/2 on amendments to single and cumulative transaction thresholds
  • APP scams: LSB publishes CRM Code review roadmap

Contactless payments: FCA PS21/2 on amendments to single and cumulative transaction thresholds

Following its consultation in CP21/3, the UK Financial Conduct Authority (FCA) has published a policy statement, PS21/2, on amendments to the single and cumulative transaction thresholds for contactless payments.

The FCA summarises the responses it received on proposed changes relating to the contactless payments limits and confirms that it has decided to amend the contactless exemption in Article 11 of its technical standards on strong customer authentication (SCA-RTS) to increase the single transaction threshold for contactless card payments from £45 to £100 and the cumulative transaction threshold from £130 to £300.

The aim of the FCA's amendments is to ensure that its regulation of payments provides industry with greater flexibility to respond to changing consumer behaviour.

The FCA states that an increase in the single transaction threshold will enable consumers to use contactless card payments for higher value transactions such as purchasing fuel and weekly groceries without needing to authenticate with strong customer authentication. It also explains that the change to the cumulative transaction threshold replaces the supervisory flexibility the FCA introduced to support the industry during the coronavirus pandemic. This means that firms can set limits up to these thresholds but not exceed them.

In making use of the new limits, the FCA cautions that firms must ensure they sufficiently mitigate the risk of unauthorised transactions and fraud, including by having the necessary fraud monitoring tools and systems in place and taking swift action where appropriate. The FCA may take appropriate measures, including enforcement action, where breaches are identified.

The FCA's amendments to Article 11 are set out in the Technical Standards on Strong Customer Authentication and Common and Secure Methods of Communication (Amendment) Instrument 2021 (FCA 2021/7), which came into force on 3 March 2021.

The FCA plans to publish a further policy statement on all the other issues it consulted on in CP21/3 later in 2021. The deadline for responses to those questions is 30 April 2021.

APP scams: LSB publishes CRM Code review roadmap

The Lending Standards Board (LSB) has announced its publication of a roadmap outlining the activity the LSB will undertake in 2021 as part of its review of the Contingent Reimbursement Model Code (CRM Code) for authorised push payment (APP) scams. The roadmap includes updates to the wording of the CRM Code, a call for input in Q1 2021 and ongoing activity with key stakeholders.

Alongside the activity outlined in the roadmap, the LSB has begun work on a follow up review of provision R2 1(c) – approach to reimbursement of customers, the outcomes of which will be published later this year.

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