UK gets faster payments at last

After a six month delay the UK’s new Faster
Payments Service (FPS) is now on target to meet its revised launch
date of 27 May, payment industry body APACS has announced.

“The UK banking industry has pulled together to
deliver this new payment infrastructure,” stressed APACS’ CEO Paul
Smee. The challenge cannot be underestimated, he added of what
APACS termed “a massively complex project.”

Given the scale of the project and the
significantly reduced payment cycles involved a decision has been
made to gradually phase in components of the service. For example,
on the launch day it is expected that only 5 percent of the
internet and phone payments will be processed as faster payments.
In addition there will be a maximum limit placed on the value of
each payment sent through the FPS, with the maximum value for
internet and phone payments set at £10,000 ($19,500) and standing
orders to £100,000. Certain FPS participants may set lower levels,
noted APACS.

By early June standing orders are scheduled to
start being made via the FPS and over the summer the overall
volumes are expected to increase to more than half anticipated
peak-day processing volumes, when completed cost of the FPS could
reach several hundred million pounds, said APACS.

Enhancements introduced by the FPS will be
beneficial to consumers and businesses. Among these, the time taken
to clear one-off payments made over the internet or by phone will
be reduced while for the first time it will also be possible to
make these payments all day every day. The FPS will also enable
same day clearing for regular standing order payments made on bank
working days, a considerable improvement compared with the current
clearing timescale of three days.

First announced in May 2005, the FPS’ 13 member
banks and building societies account for 97 percent of UK payment
volumes. The FPS operates on UK payments service provider
VocaLink’s Real-Time Payments Platform.