By Tim Ferguson, 18 May 2009 15:24
NEWS
Faster Payments, the system designed to speed up the movement of money between banks, has now seen £53.5bn in transactions since its launch last year.
In the first quarter of 2009 alone, Faster Payments saw £20.6bn pass through its network according to statistics from UK payments association Apacs.
The UK service was launched in May 2008 with 334,000 transactions being made during its first month compared to the almost 23 million in March 2009.
However, this remains a long way behind the conventional Bankers Automated Clearing Services system (Bacs), which saw more than £944bn in transactions during the first quarter of this year.
Overseen by Apacs and run by payments processor VocaLink and Chaps Clearing Company, the Faster Payments system is intended to allow funds to appear in the recipients' bank accounts up to two hours after a transaction has been initiated. In contrast, payments made through Bacs take up to three days to arrive.
Faster Payments was the result of the Treasury-sponsored Cruikshank Report in 2000, which recommended payments between banks be made quicker and more transparent.
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1. Adrian Stafford-Jones
It may be perceived generally that Faster Payments have taken a while to be implemented but in actual fact this process ran incredibly smoothly. This was a brand new initiative; therefore it was imperative for best practice to be implemented through every stage. The roll out of the new scheme has now set the precedent for future initiatives.
Finally the UK market is realising how important the Faster Payments initiative is for businesses, particularly during the credit crunch. It is quite unbelievable that industry as a whole has taken so long to recognise just how beneficial Faster Payments is; in terms of saving costs and time and easing cash flow, Faster Payments could possibly even save some SME’s from bankruptcy.
In line with the swift roll out of Faster Payments the first financial e-transaction software tool has just passed through the testing process and is now awaiting final approval. Now that Faster Payments are being fully embraced by the market, it could be the one vital element that makes 2009 brighter for businesses.
Adrian Stafford-Jones
Managing Director
Albany Software