Ransomware payments in the UK: what is allowed now and what is changing

Ransomware continues to be one of the most disruptive cyber threats facing UK organisations. As ransomware attacks and wider cyber attacks increase, many businesses are facing growing cyber risk, data theft, and cyber extortion. When systems are locked or stolen data is threatened with release, the pressure to act quickly can be intense.

One of the most common questions organisations ask following cyber incidents is whether ransomware payments are allowed in the UK.

The answer is not straightforward. While paying ransoms is not explicitly illegal, there are important legal, regulatory and ethical considerations that UK organisations need to understand. These are evolving as the UK government introduces new legislation designed to counter ransomware and strengthen UK national security.

If you are reading this because you have just experienced a ransomware incident and are unsure how to deal with it, contact Zensec immediately.

Is it legal to pay a ransom in the UK?

At present, there is no blanket ransomware payment ban in the UK. Organisations can, in principle, make ransom payments in an attempt to recover systems or prevent stolen data from being published.

However, ransomware payments carry significant sanctions risks.

If a payment is made to threat actors or ransomware groups that are subject to UK financial sanctions, organisations may be committing a criminal offence. This applies even if the organisation was unaware of the attacker’s identity at the time.

This creates a difficult position for businesses, as many ransomware criminals operate anonymously, making it challenging to assess whether such payments would breach regulations. The UK government has also made clear it does not condone paying ransoms, signalling increasing regulatory scrutiny.

When paying ransoms becomes illegal

Ransom payments can cross into illegality in several scenarios. This includes where payments are made to sanctioned entities, where transactions fall under terrorism financing legislation, or where other financial crime laws are breached.

The challenge is that during ransomware incidents, these risks are not always visible. Decisions are often made under pressure, particularly where critical systems, supply chains or public services are impacted.

This is why organisations should ensure legal and technical incident response capabilities are aligned before an incident occurs, rather than attempting to navigate these complexities in real time.

What the national cyber security centre advises

The National Cyber Security Centre advises that the decision to pay ransom demands ultimately sits with the organisation. However, its guidance is clear that organisations should prioritise cyber resilience and reducing reliance on ransom payments.

The NCSC encourages organisations to prepare for cyber incidents by implementing strong cyber security controls, including multi factor authentication, offline backups, and well-rehearsed incident response plans.

This aligns with broader UK government efforts to counter ransomware and reduce the financial incentive that underpins the ransomware business model.

How UK law is expected to change

The UK government is developing government plans and proposed legislation to introduce tighter controls on ransomware payments and improve oversight of cyber incidents.

These measures form part of a broader resilience bill and are designed to strengthen national cyber resilience across both the public sector and private sector.

The UK is building a package of measures aimed at reducing ransom payments, increasing visibility through mandatory incident reporting, and strengthening cyber resilience across critical sectors.

In practical terms, this is expected to include a targeted ban on ransomware payments for public sector organisations, including local councils and other public sector bodies, as well as critical national infrastructure and critical national infrastructure CNI environments.

Additional measures may include a ransomware payment prevention regime, where organisations must notify authorities before making payments, alongside new reporting rules and mandatory reporting requirements for ransomware incidents.

These reporting requirements are intended to support law enforcement and improve intelligence on ransomware groups and cyber criminals. However, there are concerns around unintended consequences, particularly for private sector organisations facing operational disruption.

The direction of travel is clear. The UK’s ransomware payment ban, alongside payment restrictions and increased regulatory scrutiny, is designed to make ransomware less profitable and more regulated.

Why this matters for businesses

Ransomware is no longer just a cyber security issue. It is a legal, regulatory and board-level concern that affects governance, data protection, cyber insurance, and operational resilience.

Organisations may find themselves balancing the need to restore operations quickly with the risk of breaching sanctions regulations, reporting requirements, or future legislation, alongside the potential for reputational and financial damage.

This is particularly relevant for organisations operating within supply chains or supporting public bodies, where expectations around reporting rules, incident reporting and compliance are increasing.

These are not decisions that can be made effectively when an incident occurs. Organisations must begin preparing now to ensure they can respond effectively within an increasingly regulated environment.

The case for proactive defence

While understanding ransomware payments in the UK is important, the most effective approach is preventing ransomware attacks altogether.

A strong cyber resilience strategy should focus on reducing cyber risk, improving detection of cyber incidents, and ensuring organisations can recover without paying ransom demands.

This includes implementing preventative cyber security controls, strengthening incident response capabilities, maintaining secure offline backups, and ensuring visibility across systems.

By focusing on preventing ransomware payments and strengthening resilience, organisations can avoid being placed in a position where they need to consider paying ransoms at all.

Speak to us

Ransomware attacks, cyber incidents and regulatory requirements are becoming more complex. Having the right controls, processes and expertise in place is essential to respond effectively and maintain compliance.

Prepared for every cyber threat. By combining industry best practices with tailored strategies, we help minimise damage, reduce recovery time, and strengthen your overall cyber resilience.

If you would like to review your current approach, understand further details of the latest government plans, or strengthen your defences, speak to our team.