Exactly two months from now, on the 27th May 2008, the UK Banking Industry will finally introduce a new system that will reduce the time taken for standing orders and payments made online or by telephone banking to reach the payee’s bank account. Today, it typically takes 3 working days for payments to reach the payee – a lead time established decades ago, well before the advent of computers and the Internet. It’s quite absurd that banks still insist on3 working days to move funds and the abandonment of this age old lead time, which has been called for by the government, is long overdue. The new scheme should have gone live in November 2007 but was delayed due to technical problems. Let’s hope the the revised launch date of Faster Payments is met.
Of course, here in our 21st century world, it no longer takes 3 working days for money to move from one bank to another. It takes just seconds, as evidenced by traders on global markets who buy and sell millions of shares and commodities at the click of a mouse. Thank goodness the UK Banking Industry has finally conceded that they can do the same with our money, and put in place the technology needed to make it work.
There are currently 13 UK banks and building societies committed to the programme, accounting for 97% of current payment traffic. These are:
- Abbey
- Alliance & Leicester
- Barclays
- Citibank
- Co-operative Bank
- HBOS
- HSBC
- Lloyds TSB
- National Australia Group (Clydesdale Bank and Yorkshire Bank)
- Nationwide Building Society, Northern Bank (Danske Bank)
- Royal Bank of Scotland Group
- and the impoverished Northern Rock
If your bank is not in the list give them a call to find out why. And if they’re not planning to take part any time soon you might want to find yourself another bank.