03 Mar 2008
epaynews.com, Weekly Digest, March 7th 2008, Issue no: 447
UK payments association APACS says the British banking industry is on track to provide near-real-time phone and Internet payments on May 27, 2008. The launch of the UK’s Faster Payments service was originally scheduled for November 2007, but had to be delayed due to technical problems (UK Faster Payment Plans Stall).
Faster Payments will replace the UK's current system, under which telephone- and Internet-based bank-to-bank transfers take three working days. The UK banking industry has been under pressure from the Office of Fair Trading, Britain’s consumer affairs regulator, to speed up fund transfers.
“The development of Faster Payments is a massive and complex project involving significant investment both within banks and the central (payments) infrastructure,” APACS says in a statement.
According to APACS, consumers will be able to use Faster Payments to make one-off payments via the Web or phone seven days a week.
Currently, Web and phone payments account for just 4 percent of automated payment volumes in the UK. However, Web and phone payment volumes are growing rapidly as customers abandon more traditional payment methods such as cheques.
Faster Payments will also provide same-day payment of standing orders, although this facility will only be available on working days. Currently, it takes three working days for standing orders to be processed.
Standing orders are instructions that customers give to their bank to make regular payments to a specified third party's UK bank account.
Standing orders account for 9 percent of automated payments, with the remaining 87 percent being “bulk” transactions generated by businesses such as salary payments.
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