Faster payments slow between FD and Santander?

artbaron

pmduk wrote: »

What you're describing is the effect of it going in the next working day, ie overnight, and is in full accordance with the fp regulations.

I've done many FPs and they've always appeared within hours or same day, even weekends. It's only my current account to CC that this problem arises. NatWest says on its own site that these payments happen in "near real-time – The payment will be received by the payee, almost immediately after leaving your account, but sometimes up to two hours later, providing the payment amount is within the Faster Payments set limits." It's disingenuous to call these transactions "faster payments" because they're no faster than the old system.

dalesrider

artbaron wrote: »

It's only my current account to CC that this problem arises. .

Payments will go via faster payments, but the Credit card will only show a increased avaiable balance. Not the actual credit. That will appear in a day or two when the credit card system updates.
That is normal process for payments to a credit card.

artbaron

dalesrider wrote: »

Payments will go via faster payments, but the Credit card will only show a increased avaiable balance. Not the actual credit. That will appear in a day or two when the credit card system updates.
That is normal process for payments to a credit card.

Could be but it doesn't seem very satisfactory. I assume it's all automated so why can't the CC system update either in real time or the night of the transactions, or at the very least at weekend?

It's also a bit baffling why the woman I spoke to at NatWest said she'd never heard of a transaction taking this long and she had no idea why that was. Seems like NatWest need to train their staff better.

Gromitt

artbaron wrote: »

Could be but it doesn't seem very satisfactory. I assume it's all automated so why can't the CC system update either in real time or the night of the transactions, or at the very least at weekend?

Because the banks run a batch system, and if you miss the cut-off time, you need to wait for the next working day. So after Friday, thats Monday, so you should see the transaction appear on Tuesday (or maybe Monday night).

Don't forget that the PSRs allow "Until the end of the next working day" to even receive the payment.

dalesrider

artbaron wrote: »

Could be but it doesn't seem very satisfactory.

Seems like NatWest need to train their staff better.

As someone just said in another thread... CC "It's not your money" So no need to update in real time, unlike a current account. But it does show in the avaiable balance straight away.
Most update overnight mon to fri and not over the weekend.

Not the 1st time I have heard that comment. But would go for any bank. Sometimes front linestaff need to think and not say anything. Rather than running off and spouting rubbish.

artbaron

Gromitt wrote: »

Because the banks run a batch system, and if you miss the cut-off time, you need to wait for the next working day. So after Friday, thats Monday, so you should see the transaction appear on Tuesday (or maybe Monday night).

But why doesn't the batch job run at weekends? Hopefully they don't have an IT guy sitting at a keyboard typing "run pay_cc.exe" before he goes home at 5pm. Hopefully...

dalesrider wrote: »

As someone just said in another thread... CC "It's not your money" So no need to update in real time, unlike a current account. But it does show in the avaiable balance straight away.
Most update overnight mon to fri and not over the weekend.

Not the 1st time I have heard that comment. But would go for any bank. Sometimes front linestaff need to think and not say anything. Rather than running off and spouting rubbish.

You're right, it is showing in the "Available balance" (plus 1p for some reason, but I guess it's a rounding error). Amazing that the Nat West woman on the phone didn't know that. And come to think of it, neither did the woman on Chat who was purportedly from the CC department.

Gromitt

artbaron wrote: »

But why doesn't the batch job run at weekends?

Because they are not a bank working day. Working days run from Monday to Friday (except Bank Holidays).

Historically, it was so that other systems could be disabled to allow more processing time for such things as interest calculation, payment processing, etc. They could do everything real time now, but it would cost billions to change all the systems and get them very little back.

I believe some banks do run a weekend batch (at the end of Saturday), but not many.

Buzby

Nationwide isn't a bank in the accepted sense. They use a third party to process their payments and this is reflected in the tardy nature of their transfers.

artbaron

Gromitt wrote: »

Because they are not a bank working day. Working days run from Monday to Friday (except Bank Holidays).

Historically, it was so that other systems could be disabled to allow more processing time for such things as interest calculation, payment processing, etc. They could do everything real time now, but it would cost billions to change all the systems and get them very little back.

I believe some banks do run a weekend batch (at the end of Saturday), but not many.

I understand it would be a big job to move to real time (I've lead two major projects to do this although not in the banking sector) but it's not a big job to modify the schedule on what is essentially a batch queue. Ten or 20 years ago fair enough, you had to be careful with your processing resources, but not any more.

Buzby wrote: »

Nationwide isn't a bank in the accepted sense. They use a third party to process their payments and this is reflected in the tardy nature of their transfers.

I'm with NatWest, though, what's their excuse?

mulronie

The biggest issue is actually how the banks approach the interbank settlement of FPS transactions. FPS is a system that clears near-real-time, but settles on a net deferred basis.

For example, over the course of a weekday morning, Santander customers might pay £1million to Natwest customers, and Natwest customers might pay £2million to Santander customers. While the banks will both show all their customers that funds have cleared, no money will actually have changed hands between the banks to reflect this - i.e. they will not have settled.

So, at this point you can see that Natwest will owe Santander (net) £1million. These balances are constantly changing, but the banks settle fully with eachother 3 times a day by using their CHAPS accounts at the Bank of England - they do this at 7.15am, 1.00pm and 3.45pm

After the last batch settlement on a Friday at 3.45pm, however, the banks will not be able to settle with eachother until the next batch at 7.15am on Monday morning.

What happens if a bank blows up over a weekend? The FPS payments sent by that bank over that weekend will not be honoured come 7.15am Monday! To mitigate this so-called "settlement risk", each bank has a "net settlement limit" built into FPS, allowing a maximum amount by which they can go into "debit". Above this limit, FPS would reject any further payments that institution tried to make.

Some institutions are worried that they would breach their "net settlement limit" if they allowed their customers to process FPS payments over the whole weekend. This would be a nightmare for the bank, cause reputational damage and a lot of customer noise - so for an easy life they instead shut off outbound FPS completely.

FWIW this is also one reason (of a handful) why the absolute maximum FPS value is £100,000 for any customer of any bank, and why some banks put their personal limits lower still.