Payments between bank accounts are set to get faster

Faster Payments – the process that sees money transferred between bank accounts within two hours – will be rolled out further next week, with quicker internet and phone transfers becoming standard for many more accounts from January 1.

Under new rules, electronic payments within the EU are supposed to reach recipients’ accounts by the next working day. However, all standing orders and one-off internet and phone banking payments in the UK will exceed this deadline, with the entire process completed within the two hours.

“This is great news for consumers and businesses,” said Payments Council chief executive Adrian Kamellard.

“More bills are going to be paid more quickly through Faster Payments, and the change will mean more certainty if you have been sent money, too.”

However, it’s important to note that not all payments will be classified as Faster Payments. In order to benefit from this speedy process, recipient accounts have to be classified as “payment accounts”. All credit-card accounts tick this category, which means anyone paying a card bill electronically will see the money credited within the two hours.

But “non-payment accounts” (such as many Isa accounts) will not be credited so quickly, and the exiting rules surrounding these accounts will remain in place.

For more details, visit www.payyourway.org.uk, or call your bank or building society to find out if your accounts will accept Faster Payments.

Payments by cheque will be unaffected by the changes.