From the end of October 2024, UK banks will be able to withhold suspicious payments for up to four days, raising fears that large property purchase transactions will be blocked on a regular basis.
The changes are part of the Payment Services (Amendment) Regulations 2024, which came into force earlier this month, and means banks must refund up to £85,000 to fraud victims within five days. 
When a transaction is flagged as anomaly, the bank examines the spending pattern, contacts the customer, and conducts further investigation before transferring the money.
Even a small number of late payments can have major ramifications for the moving company. ”
The payment delay is aimed at deterring financial fraudsters, such as those targeting the property market, who seek to trick people into transferring deposits or purchase funds.
According to Propertymark, fraud schemes are becoming increasingly sophisticated, with criminals often posing as lawyers or conveyancers to gain customers' trust and trick them into handing over cash.
According to Propertymark, small and medium-sized businesses, such as small and medium-sized real estate agents, are particularly vulnerable to payment diversion fraud, with perpetrators targeting specific individuals, impersonating others, creating or amending invoices, and invoicing criminals. The payment will be diverted to a bank account controlled by the bank.
A sledgehammer for cracking nuts?
However, representative groups have questioned whether the new measures are a “sledgehammer”, saying: However, fraudulent transactions represent a small portion of the business.
“In the home purchase market, it is becoming increasingly common for completions and exchanges to take place on the same day, and even a small number of late payments can have significant ramifications for movers.”
Propertymark says it will monitor implementation and communicate with stakeholders to share evidence of unintended consequences. Agents experiencing issues due to the changes should contact our Policy and Campaigns team at email protected.
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