People across the UK are taking full advantage of a new money transfer scheme being monitored by the Payments Council.
According to the council’s latest quarterly statistical report, Britons sent two-thirds more money through Faster Payments in the final three months of 2011 compared to the previous year.
A total of £76 billion was sent during this time, which is up significantly from the £46 billion sent during the final quarter of 2010.
The report also found that the number of transactions had increased year-on-year by 23 per cent, meaning that the scheme is gaining in popularity.
As of January 1st 2012 Faster Payments became the default system for phone, standing order and online payment processing in the UK, in line with current European Union legislation.
Some 99.9 per cent of UK sort codes can now send and receive these payments, with 81 per cent of all standing orders using the service by December 2011.
The rise in speed for online payments and standing orders has also meant a steady decline in the number of cheques cleared, as the payment method falls out of favour with the British public.
During 2011 12 per cent fewer cheques were cleared than the previous year; however 2.7 million cheques were still cleared every day in the last three months of 2011.
The Faster Payments scheme was first outlined during December and made it a legal requirement for electronic payments to reach the recipient’s account by the next business day at the latest.
It was designed to enable consumers to pay bills such as taxes, credit card payments and rent on a same-day basis for the first time, making online money transfers more efficient to use.
Payments across the European Union have one working day to reach the recipient’s account, but standing orders. One-off internet and phone banking payments in the UK need to exceed this requirement by being processed end-to-end within two hours through the speedier payments scheme.
Adrian Kamellard, chief executive of the Payments Council, commented on the Faster Payments initiative back in December and claimed that it was essential in cutting down on unnecessary payment processing waiting times.
Mr Kamellard went on to say that the scheme was “great news for consumers and businesses”, as they could take advantage of faster money transfers, meaning they have access to their money quicker and can pay for products and services with greater ease.
“More bills are going to be paid more quickly through Faster Payments and the change will mean more certainty if you have been sent money too,” he explained.
While the system has been up and running since the beginning of 2012 consumers and businesses can access further information from the PayYourWay website, which contains a factsheet full of frequently asked question and “advice and guides on every aspect of payments”.
This is helpful, as the chief executive later added that “not all payments we make will fall under this regulation and it is important to understand which will and which won’t”.
