Australians scammed out of A$3,000 or less could be able to claim automatic reimbursement from banks, phone companies or tech companies, under a new federal government proposal.
Last year, there were 481,523 scam reports in Australia, worth A$2.18 billion, with a median loss of $400, a recent official report found. That was up 7.8% from the year before, but down since scams peaked at $3.1 billion in 2022.
At first glance, if the median scam amount was $400, being able to easily reclaim $3,000 might sound generous.
However, once you start digging deeper into data on Australian scams – then compare it with a similar scheme in the United Kingdom – $3,000 starts to look like an oddly low threshold.
Who would win under the new proposal?
The federal government has just released new details of its Scam Protection Framework, which will make banks, telcos and digital platforms set up stronger anti-scam systems by March 31 next year.
Part of that new framework is a proposed dispute resolution process, making banks, telcos and digital platforms “automatically reimburse scam victims for verified scam losses below $3,000”.
The goal of those automatic repayments would be to prevent low-value scam claims needing to go through costly dispute resolutions. That would save time and stress for scam victims, and avoid wasted time for police and the companies involved.
The reimbursement costs would be shared by the banks, telcos and digital platforms, which would repay people scammed via their services. This follows a similar approach in the UK, where banks sending and receiving fraudulent payments are equally responsible for the reimbursement cost.
The proposal says “the majority of scam complaints lodged in Australia involve losses under $3,000, despite accounting for a small fraction of total scam losses”. And that’s true: a lot of Australians stung by relatively low-level scams would benefit from this proposal.
But a closer look at scam data reveals that some of the most common and costly types of scams would end up not being covered.
Who would miss out?
Australia’s consumer watchdog, the Australian Competition and Consumer Commission, runs the Scamwatch website.
It shows investment scams were the single costliest type of scam in 2025, making up almost half of all of the losses it tracked.
The median loss for an investment scam last year was $7,000. That’s far higher than the proposed automatic scam repayment scheme.
Several other of the top ten most common scams last year – offering fake jobs, money recovery and payment redirections – also had median losses that were higher than $3,000.
The federal government says more expensive scams would have to go through a dispute resolution process instead.
The UK has far higher rapid repayments
In 2019, the UK introduced a voluntary code for its major banks which encouraged victims of “authorised push payment” scams to receive compensation directly from the banks.
This was a revolutionary change for the UK – but it had a mixed reception. Not all banks engaged with the code. Outcomes for consumers were inconsistent, with refund decisions varying considerably.
So the UK changed its Financial Services and Markets Act 2023 which, for the first time, introduced world-first mandatory reimbursements. That’s now been in force since October 2024.
The maximum amount of money an individual can claim is £85,000 (A$159,900), which covers more than 99% of claims. Where more than £85,000 is lost and not reimbursed, people can raise their case with the free Financial Ombudsman Service, which has a compensation limit of £430,000 (A$809,000).
There’s still a requirement for individuals to take responsibility for their transactions. But as long as there is no evidence of negligence, particularly in ignoring warnings from the bank, the refund is usually made within five days.
The UK scheme only covers domestic bank transactions, not international transactions or those involving cryptocurrency. This is narrower than the Australian proposal, which also brings in telcos and digital platforms.
A report looking at the first six months of the UK scheme found 86% of scam losses were returned, totalling about £27 million (close to A$51 million). A similar proportion of refunds (84%) were processed within the five-day guideline.
Asked why Australia was proposing to set its automatic payment threshold lower than the UK, Financial Services Minister Daniel Mulino said the government didn’t want to incentivise bigger scams:
What we want to do is to make sure that we don’t have the wrong incentives for perpetrators to see Australia as a soft target.
Lifting an ‘oddly low’ threshold
It’s good news that Australia is trying to broaden reforms first started in the UK, by going beyond just bank transfers as the UK does to also capture payments made on other large digital platforms.
But what about the automatic repayment threshold: should we set it as high as the UK, equivalent to almost $160,000 here?
Actually, I don’t think we should.
If you’re making payments of that size, such as a home deposit, there’s a good case for insisting on extra diligence.
For instance, when I bought a property, I got an email from the realtor with account details. Instead of just transferring all the money at once, I rang them directly first, checked the account, then transferred a small, specific amount and rang again to ask them to confirm they’d got it.
But $3,000 is oddly low as a proposed threshold.
More research would be needed to recommend a more adequate amount. But given this is out for public consultation until June 25, now is the time to reconsider what the threshold should actually be.
Unless it’s lifted higher, national scam data shows too many people will still miss out.
