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What Are Faster Payments?

What are Faster Payments?

Essentially, Faster Payments are a type of Bank Transfer, and the two terms can be interchanged. 

Faster Payments are (almost) instant payments between banks and building societies in the UK. They are accessible to around 50 million account holders, allowing them to make electronic payments online, over the phone or in branch. 

Businesses use Faster Payments to pay business expenses such as recurring bills, single one-off payments and supplier invoices.  

Faster Payments are currently free of charge for personal customers. Transfer times are not guaranteed, and transactions will sometimes take up to two hours to clear, but usually they’re paid immediately. 

 

What are the types of Faster Payments? 

There are four different Faster Payments methods, let’s look at how they work: 

  1. Single Immediate Payments (SIPs)

These are the most common type of Faster Payment methods, allowing customers to initiate them online, via phone banking or in branch. SIPs can be sent 24/7, and are normally capped at around £250,000 per transaction, depending on limits set by the bank.  

  1. Forward-Dated Payments

Forward-Dated payments are set up in advance to be paid on a pre-arranged date, so they’re normally used to pay bills and rent. Similar to how SIP’s work, they can be set up via online banking, mobile banking or in branch, and they can be sent 24/7.  

Forward-Dated payments can be sent at weekends or banking holidays but the incoming payment might only be processed on working days, which could slow the process. 

  1. Standing Orders

Standing Orders let the user pay a set amount on a recurring date, making them useful for paying household bills and subscriptions. Standing Orders normally have a £20,000 transaction limit.  

  1. Direct Corporate Access

This payment method works in a similar way to Bacs, allowing users to send payment messages direct to Faster Payments in the form of bulk files. They also use a secure-IP solution, and users can use software solutions to simplify the process. 

 

Faster Payments vs Bacs and CHAPS 

Bacs is a commonly used payment system in the UK. It’s different from Faster Payments in a few ways: 

  1. Bacs payments are slower than Faster Payments, typically taking three working days to clear 
  2. Bacs payments are transacted directly between bank accounts 
  3. Bacs payments are mainly used by organisations for Direct Debit and Direct Credit payments 

CHAPS is another popular payment system in the UK, which guarantees that money will arrive on the same day it is sent. However, there is a £25 fee per payment, so it’s mostly used by organisations for infrequent high-value transactions. 

 

Which Banks Support Faster Payments? 

Almost all banks in the UK including the major players like HSBC, Barclays, NatWest and Santander all support Faster Payments.   

 

Which banks are Faster Payments direct participants? 

Some institutions are direct participants in the Faster Payments Service meaning they connect directly without need for a third part sponsor.  

These banks, building societies and financial services are listed below: 

  • The Access Bank UK 
  • Atom Bank 
  • Barclays 
  • BFC Bank 
  • Cashplus 
  • Citi 
  • Clear Bank 
  • Clydesdale Bank 
  • The co-operative Bank 
  • CreDec 
  • Danske Bank 
  • Ebury 
  • Elavon 
  • HSBC 
  • HSBC UK 
  • JP Morgan 
  • LHV 
  • Lloyds Bank 
  • Metro Bank 
  • Mettle 
  • Modulr 
  • Monzo 
  • Nationwide 
  • NatWest 
  • PayrNet 
  • PPS 
  • Prepaid Financial Services 
  • Revolut 
  • Santander 
  • Equals Money 
  • Square 
  • Starling Bank 
  • Tandem 
  • Tesco Bank 
  • Wise 
  • TSB 
  • Turkish Bank UK 
  • Virgin Money 

London and Zurich Faster Payments Module 

London & Zurich offer a Faster Payments tool to our customers, to help businesses make payments on time.

Get in touch and you could be up and running in a few days – contact our sales team today on 0121 234 7999 or email [email protected] 

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