Direct payments at bank of credit card issuer

Milarky

Does anyone know from experience whether a payment made from a personal account held at a bank which holds the collection account for a credit card issuer will reach your account with them any quicker because it is potentially an 'internal transfer' - and therefore not liable to a cleaning [erm, 'clearing'!] cycle?

[Bonus points will be awarded for actually working out what this question means ]

King_Of_Fools

Yes, Halifax payments from their current account to their credit card clear on the day made. This is also true if you pay the card account in cash at any of their branches before 4pm even if you do not have a current account.

The_Boss

My payments from NatWest current account to NatWest credit card take longer than the transfer from the same current account to MBNA and Morgan Stanley.

YorkshireBoy

King of Fools/The Boss - I think the key phrase in Milarky's post is 'collection account'.

The best example I can give, although I've no experience of the time taken, is that the Co-op have the 'collection account' for Virgin credit cards.

Milarky - can you confirm that this is what you mean? (and if it is, can I have the bonus points? ).

Some examples...

Card Provider..........Collection account
Virgin.......................Co-op
Capital One...............HSBC
Marks & Spencer........Alliance & Leicester

The_Boss

Ahh, I get it. I had no idea a collection account was a different one.

King_Of_Fools

YorkshireBoy wrote:

King of Fools/The Boss - I think the key phrase in Milarky's post is 'collection account'.

The best example I can give, although I've no experience of the time taken, is that the Alliance & Leicester have the 'collection account' for Virgin credit cards (I haven't got my statement to hand, but I'm sure the statement girobank stub states A&L?).

In that case it is a slightly different position. However, what I said about Halifax is still true for this.

I am not sure, however, if Virgin use A&L as the collection bank or just the processing. A&L own the Girobank brand and so you will see their logo and name on any Birobank slip even when the collecting bank is somebody else.

The collecting bank's name is always printed in the middle of the Girobank slip along with the destination sort-code and account number.

I would say that if the card company and the collecting bank are different then I doubt the money would be transfered directly; it would probably take an extra working day to update the card account.

YorkshireBoy

King_Of_Fools wrote:

I am not sure, however, if Virgin use A&L as the collection bank...

Sorry King of Fools, I've modified my first post as you typed your reply, having rung my 'secretary' at home. I'd got it wrong but my revised list above is taken from my statement stubs.

King_Of_Fools

YorkshireBoy wrote:

Sorry King of Fools, I've modified my first post as you typed your reply, having rung my 'secretary' at home. I'd got it wrong but my revised list above is taken from my statement stubs.

That is quite alright!

I thought it would probably not be A&L!

Milarky

YorkshireBoy wrote:

Milarky - can you confirm that this is what you mean? (and if it is, can I have the bonus points? ).

Some examples...

Card Provider..........Collection account
Virgin.......................Co-op
Capital One...............HSBC
Marks & Spencer........Alliance & Leicester

Yes, that is what I had in mind, YB. I've had to arrange a payment to Egg - allowing the two clear working days ahead of the B/H weekend. This set me thinking. I bank with First Direct. They are part of HSBC (sort code begins '40'). Egg's collection account is with.... HSBC ('40 02 50'). HSBC have confirmed that if I pay money in (or equivalently transfer from a FD current a/c) to another personal current account held with that group it will have 'same day' value (and probably be instantly credited). They said they thought that money paid into an HSBC collection account would be credited to the customer (in this case, Egg) just as quickly but that it was up to the customer how they treated that payment as 'cleared' - which does make sense, of course. My next thought was to send Egg £1 through the counter service to see how quickly they payment arrived but my second thought was that was just the same as an internet transfer for personal accounts anyway and, since payments previously to made Egg via First Direct have not through gone any faster than those from non HSBC sources it is unlikely that Egg would credit my account with them any sooner than the two working days they say they require.

Interestingly (or not so interestingly, maybe) I've come across some instances of 'next day' payments that suggest things can move more quickly - possibly because of internal systems - but nothing that makes sense:

Egg card ('40') ----> Nationwide CC ('07') - 1 day

Nationwide Savings ('07') ----> Halifax CC ('80') - 1 day

First Direct ('40') ---> Cahoot CC ('09') - 1 day

YorkshireBoy

Hi Milarky, I'll be interested in the outcome of any experiments you conduct, but let me give you a couple of examples that highlight *my* frustrations with internet banking/BACS transfers...

1. I pay my LTSB card by online banking from my current account. I ring the LTSB automated balance/payments line after 3 days to see if the payment has landed - it hasn't! I ring again the next day, and the next, and the next. Finally, after 8 or 9 days, the payment lands - and the payment credit is backdated to day 3 (the day I first rang!!).

2. Both my son and I have the same current account provider - albeit with different branches. My branch recently closed down and they moved my account to my son's branch, but left me with the original sort-code (last 2 digits only different). My son has always paid his 'board' by SO and it has always taken 3 days to arrive in my account. Now we're both with the same branch, guess how long this payment takes to arrive in my account.....that's right....it still takes 3 days!!


Roll on same day transfers!!

King_Of_Fools

YorkshireBoy wrote:

Hi Milarky, I'll be interested in the outcome of any experiments you conduct, but let me give you a couple of examples that highlight *my* frustrations with internet banking/BACS transfers...

1. I pay my LTSB card by online banking from my current account. I ring the LTSB automated balance/payments line after 3 days to see if the payment has landed - it hasn't! I ring again the next day, and the next, and the next. Finally, after 8 or 9 days, the payment lands - and the payment credit is backdated to day 3 (the day I first rang!!).

2. Both my son and I have the same current account provider - albeit with different branches. My branch recently closed down and they moved my account to my son's branch, but left me with the original sort-code (last 2 digits only different). My son has always paid his 'board' by SO and it has always taken 3 days to arrive in my account. Now we're both with the same branch, guess how long this payment takes to arrive in my account.....that's right....it still takes 3 days!!

Roll on same day transfers!!

Unfortunately, what you have encountered here is a case of very old bank systems in operation. Lloyds TSB are still branch based and any money moving between branches has to be cleared through the batch system as would an external transfer.

As an alternative, having moved money internally between various accounts at various branches of both the Halifax and Nationwide, I can say that money can tranfer immediately. So, for example, if I were to request an account transfer, between my Nationwide account and my father's, online right now he could then draw that money out from any bank's ATM a minute later even though we are not in the same area of the UK.