Faster payments service ‘still too slow’

Almost half of the transactions eligible for the Faster Payments System still take more than three days to be processed, according to recent reports.

The BBC has revealed that some £45 billion has not gone through the clearing infrastructure since its introduction a year ago.

Launched on 27 May 2008, the Faster Payments service enables one-off banking transactions made over the phone or via the internet to be actioned within a few hours, reducing the former three-day clearing period.

However, many banks are imposing an upper limit on the value that can be transferred by the system, thereby cutting the number of same day transactions.

Research by the BBC suggests that nearly half of the 13 founding members do not permit standing orders to be processed through the system, while the majority do not allow customers to settle their credit card bills via the service.

Sandra Quinn from industry body Apacs insists that the system is working but that improvements are necessary. ‘Our main target in the first year was to make sure that it worked. It's robust. It works everyday. But we are getting frustrated […] those customers who have walked away, actually they've done the right thing.’

Earlier this year the Office of Fair Trading claimed that customers had missed out on up to £82 million because the launch of the new system had been ‘slow’. It said it did not expect the enhanced clearing service to reach full capacity until June 2009.