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What exactly are BACS & CHAPS payments?
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# 1
Old 16-04-2008, 7:57 AM
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Default What exactly are BACS & CHAPS payments?


I'd welcome a little advice...

I've been asked to make a BACS payment.

Is this the same as setting up a payee within your account so you can make one-off or regular payments?

What's the difference between BACS and CHAPS?

Thank you in advance.

"Life may not be the party we hoped for... but while we are here, we might as well DANCE !!!"
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# 2
Old 16-04-2008, 8:06 AM
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Basic differences (N.B. very roughly, from memory)

BACS - usually free, takes 3-4 days fo credit receiving account.
CHAPS - usually charged (£20 a time, with one of my accounts), same day transfer.
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# 3
Old 16-04-2008, 8:07 AM
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a bacs payment is a single payment, typically takes 2/3 days from your account to theirs. usually no fee, depending on your tpe of a/c.

a standing order is a regular payment as above- up to you to stop/change amounts and dates; best for 'complete' control(??) of your a/c, and fixed repayment amounts- loans, subscriptions etc.

a direct debit is different, where the payee claims from your a/c (after giving advance notice), whatever is due / agreed- best for variable bills- mobile, gas etc.

chaps is same day (usually for large / urgent amounts); fees negotiable with your bank, but say £40 a time.

** ALWASY triple check the payee's details.. whn its gone, its gone! **
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# 4
Old 16-04-2008, 2:56 PM
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see :

and then maybe :

followed by :

Hope that helps.

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# 5
Old 16-04-2008, 3:41 PM
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Join Date: Aug 2007
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I would just add that CHAPS payments are generally seen as being 'safer' than BACS payments because it requires a senior manager to check the transfer at each end (at sending and receiving banks) - so if it's a very large amount you're transferring (well over £50,000) then CHAPS can give you some extra peace of mind.

However in reality I don't know if there's a lot of difference in security between BACS and CHAPS, would be interesting to know if there are any stats around that show what percentage of BACS transfers go bad compared to CHAPS.

CHAPS payments are also 'same day' (as long as the transfer is put in before a deadline time, usually mid afternoon or so?), so often if you're transferring huge amounts of money you can save money by using CHAPS because the amount you gain in interest payments from money going same day is more than the cost of lost interest during the 3 days BACS takes to transfer plus the cost of the CHAPS transfer.

Will be interesting to see how this changes in May when BACS transfers become 'same day' - it's questionable whether banks will still be able to justify charging up to £35 for a CHAPS transfer when BACS takes the same amount of time - they'd be saying you're paying the charge just for the peace of mind, which as above is questionable anyway.
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