Background

In May 2005, the Payment Systems Task Force, chaired by the Office of Fair Trading, announced that an agreement had been reached with the banking industry to reduce clearing times on phone, internet and standing order payments. 

The banking industry committed to develop a system whereby payments would clear in half a day, however they have surpassed this by creating a system where the beneficiary is able to access funds within a couple of hours of a payment being made. Faster Payments delivers a huge improvement on the system used previously, where the vast majority of electronic payments took three working days to be processed. 

In October 2005, the contract to provide the central infrastructure for this new service was awarded by UK Payments (formerly APACS) to Immediate Payments Limited, a joint venture company set up by VocaLink.

Faster Payments is the first new payments service to be introduced in the UK for more than 20 years. For the very first time phone, internet and standing order payments can move within a few hours - almost at the touch of a button.

From the end of May 2008 most banks started offering the new Faster Payments Service for internet and phone payments. Standing orders started to be processed using the new service from June 2008. 

 

Which organisations are involved?

CHAPS Clearing Company is responsible for the day-to-day operations and management of the service. CHAPS Clearing Company is a member-based company.  

UK Payments (formerly APACS) was responsible for the development and delivery of the Faster Payments Service. The design of the Faster Payments Service was a joint project between Immediate Payments Ltd. (IPL), UK Payments and the 13 founding member banks, based on the commitment made to the OFT Payment Systems Task Force.  IPL, a VocaLink company, supplies the central network for the Faster Payments Service. 

 

The founding members in May 2008 were: 

  • Abbey (now Santander UK plc)
  • Alliance & Leicester
  • Barclays
  • Citi
  • Co-operative Bank
  • Clydesdale and Yorkshire Banks (National Australia Group)
  • HBOS
  • HSBC
  • Lloyds TSB
  • Nationwide Building Society
  • Northern Bank (Danske Bank)
  • Northern Rock
  • Royal Bank of Scotland Group (including NatWest and Ulster Bank)