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On 27 May 2008, the UK Banking Industry launched a new payments service called Faster Payments.
Faster Payments does exactly what it says. As long as both sender and recipient banks are part of the service and the amount is within the maximum limit, when you pay bills or transfer money it should reach the beneficiary's account straight away, 24/7, 365 days a year. It's just like making payments to first direct or HSBC accounts, only with other banks.
It's basically the same as making a regular payment - you can use Internet Banking and the telephone - and you don't need to do anything extra. When you make a payment, as usual you'll be told how long it'll take and when the money will leave your account.
If the bank you're transferring to isn't part of the service, or if you're transferring over £10,000 in a single payment, then the existing three-day process will still apply, but we'll let you know at the time. And if someone is paying money into your account, then as long as their bank is part of the Faster Payments service, you'll have your money faster too.
If you're paying a credit card or utility bill, you should double check the back of your statement to find out how their payment systems work, as sometimes they may need a bit more time.
Unfortunately although you'll be able to send Standing Orders via Faster Payments, first direct won't be using this part of the service until late 2008 or early 2009. You may still receive payments via Standing Order earlier than the current three-day service but we're afraid we can't guarantee it. Direct Debits won't be affected by the Faster Payments service.
Faster Payments can be sent 24 hours a day, 7 days a week and can also be future dated - all you have to do is make sure you have the funds available to meet any payments you've arranged. You'll also be able to make payments on weekends and bank holidays.
As a result of the new service please bear in mind that as soon as you authorise a payment to be sent it can't be cancelled or delayed as the money will leave your account straight away. And if you have a payment due to be made, then that could affect the amount you have available in total.
It's just the same as with a regular payment - all you need is the sort code and account number of the account you're sending to.
If you are making a payment via Internet Banking and the payment is going via the Faster Payments service you'll notice the date of payment and date of arrival are the same. If the payment cannot be sent using Faster Payments then the date of arrival will be different, usually three days later as with the regular three-day payment cycle. Don't worry - however long it takes, we'll always tell you when the money will arrive.
There is a limit of £10,000 per transaction for the Faster Payments Service. If you want to send a single transaction above this limit, the payment will be sent using the usual three-day payment cycle.
You'll be able to make exactly the same types of payments you make now to beneficiaries such as credit cards, utility companies, personal accounts etc. Unfortunately, you won't be able to use Faster Payments to pay first direct credit cards until November 2008.
If a payment is sent from your 1st Account (which is linked to your offset Mortgage), the interest is calculated as below and the amount still counts towards your offset interest balance:
| BACS (the three-day payment cycle) | |
|---|---|
| Day 1 | £100 leaves your 1st Account to pay a utility bill, but remains available for interest purposes in your account balance to offset against your Mortgage balance for interest purposes |
| Day 2 | £100 still remains available to offset against your Mortgage balance |
| Day 3 & 4 | £100 received into the utility bill bank account and is no longer available to offset against your Mortgage balance. |
Using the Faster Payments service, payments will be sent as follows:
| Faster Payments | |
|---|---|
| Day 1 | £100 sent to pay the utility bill and received into utility bill bank account and is no longer available to offset against your Mortgage balance. |
So if your utility company accepts Faster Payments, we'd suggest sending the payment on Day 3 or 4.
Not necessarily. You'll need to check the information on the back of your bill or statement to ensure it will be paid on time. All companies accepting Faster Payments and providing bills to customers should include information about timescales on the back of their bills or statements.
You can make Automated Bill Payments (ABPs) and Standing Orders using Faster Payments. However first direct currently only use the service to send Automated Bill Payments. Standing Order payments can be received via Faster Payments but won't be available to send from your first direct 1st Account until later in 2008 or early in 2009.
It's faster! Since Faster Payments is 24/7, you'll be able to make payments all day, every day, speeding up the process so that payments are received in a matter of hours rather than days. However, you should always check with the person you are paying whether they can accept Faster Payments and what details you should use.
The Faster Payments service is just as secure as any of the other payment services and as with those services, providing bank account and sort code details is perfectly safe. You should always monitor any accounts and statements closely though, and alert your bank if you notice any unauthorised transactions.
If you're making a Faster Payment on Internet Banking, the date of arrival should be the same as the date to leave, although the beneficiary bank may take additional time to allocate the funds to an individual account. The amount will also debit your account with first direct straight away. (If the bank you're sending to rejects the payment for some reason, the funds won't debit your account.)
If the payment has been accepted the funds should arrive in the other person's account within a few hours. It's worth making sure that the money you're sending is going direct and not into a collection account first. If the payment has to be received into a collection account first, then your payment might not be credited immediately.
As before, you should make sure there is sufficient time for the payment to be received - though this should obviously now be shorter. Please allow at least four hours - if it hasn't arrived by then, just give us a call.
11 banks have joined the service, although as each bank will build up the service at different times, we can't guarantee that a payment will be faster.
The 11 banks launching on day one are as follows:
Note: Abbey National Plc and Co-operative Bank Plc will not be joining the service from day one; they will start to participate later in 2008.
first direct is a division of HSBC Bank plc. © HSBC Bank plc 2008. All Rights Reserved. Member HSBC 
Group.
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