UK-based SME lending platform Tide has called for the introduction of an “anti-fraud tax” to tackle what chief executive officer Oliver Prill said had “become a terrible blight on the UK”.
Tide said the government’s new Fraud Strategy, released this week, is a “step in the right direction” but that it needed to “be bolder and more ambitious”.
The lending platform, which is used by more than 9% of the UK’s small businesses, welcomed the government’s decision to create a National Fraud Squad with 400 new investigators. However, the fintech platform this number was “nowhere near enough” to combat the 2.7 million scams carried out on the British public each year, according to National Cyber Security Centre data.
Tide has proposed that an anti-fraud tax would apply to social media and telecoms companies, as well as faster payment transactions, to fund the required law enforcement capacity.
The levy would also fund UK law enforcement agencies and make it mandatory for them to investigate and prosecute scammers, including those based abroad, under a zero-tolerance policy, Tide said.
It also recommended that the reporting of all instances of fraud by financial institutions become obligatory.
“Fraud causes enormous harm and puts stress on small businesses, consumers and financial institutions – and in the process, this damages the UK’s economy,” said Prill (pictured).
“The target to cut fraud by only 10% by the end of 2024 with another 400 police officers is nowhere near enough to combat the sheer scale of the problem and the damage done. This is why we are calling for a tax to fund action against what has become a terrible blight on the UK.”
Ministers have been urged by Tide to adopt mandates for all financial institutions, or payment service providers, to take part in Confirmation of Payee (CoP) and mandates for social media and telecoms companies to maintain records of all their advertisers and users, and feed this into CoP data.
Prill added: “Instead of guaranteeing returns to fraudsters through mandatory reimbursement, such money, alongside an anti-fraud tax, should be invested in fraud prevention and prosecution.
“We believe that our policy recommendations can help turn the tide on fraud.”
Listen to Tide chief executive officer Oliver Prill and Simon Cureton, chief executive officer of Funding Options on the Open Banking Expo Unplugged podcast discussing their merger, as well as the environment for SME lending.