At present, internet and phone payments take three days to
complete, and financial institutions have been criticised over the
length of time involved. The delay nets banks a reported £30
million per year from interest earned on the transferring
money.
The Office of Fair Trading’s Payment Systems Task Force issued a
report into the practice in May, following which APACS agreed to
set up a system that would increase the speed of payments.
The industry association announced on Friday that it had
completed the first phase of the project. The new system would
allow payment transfers to take place within hours of being
instructed, it said, and would be available on a 27/7 basis.
The new system would also enable standing order payments to move
more quickly so that money would move from the payer’s account on
the due date and arrive at the beneficiary’s account on the same
day, said APACS. This service will only be available on and within
banking business hours.
Eleven financial institutions, accounting for over 95% of
today’s existing automated payments, have signed up for the project
so far.
“This is really good news for both personal and business bank
customers,” said OFT Chief Executive John Fingleton. “The banking
industry has met all the criteria set for it. I am particularly
pleased that the near real time service, available 24/7, to be
introduced by the end of 2007, goes even further than the Task
Force recommended. ”
The new system will not affect traditional payments made using
cheques.
