Bank of Ireland said it is writing to some of its personal and business customers to apologise for a delay in the rollout of Strong Customer Authentication (SCA).
SCA is being introduced in banks across Europe as part of the second Payment Services Directive (PSD2).
SCA gives bank customers an extra layer of protection when shopping online as they must use the bank's mobile app to approve certain payments.
Bank of Ireland said the authentication process is now fully in place.
It had been working towards a full implementation date of June 30, but the bank said it took longer for it to introduce it than anticipated.
"We apologise sincerely for this delay," Bank of Ireland said in statement.
The bank also said it will refund a portion of bank charges to all personal current account customers and to business current account customers who made an automated debit transaction.
The average refund per customer is under €3 and the overall refund cost to Bank of Ireland is €3m.
Bank of Ireland said that customers do not have to take any action, and the refund will be paid directly to their accounts in December.
Where an account has been closed, Bank of Ireland said it would make a charitable donation which will result in a payment of about€27,000 to The Community Foundation for Ireland.
Henry Dummer, Director of Everyday Banking at Bank of Ireland, said that while online fraud has been around for many years, the pandemic has seen an increase in activity, with fraudsters targeting consumers and businesses as they spend more time online.
"We have invested significantly over the years in strengthening both awareness and protection around online fraud and Strong Customer Authentication is an important extra step," Mr Dummer said.
"We are pleased that SCA is now in place for all customers, but it should have been in place earlier," he stated.
"We are sorry for this delay and are writing to customers to apologise and provide a refund. We are also reminding customers to be alert to the risk of fraud, particularly in the run-up to the busy Christmas shopping period," he added.