What does a CHAPS fee actually cover?

[Deleted User]

Thanks for all the replies. I've not used a CHAPS transfer before. My reason for asking is that I am trying to get 4 different amounts of money cleared into one account before the expiry date of my mortgage redemption statement.

I will be using a CHAPS transfer to the mortgage account when the full amount is there but I was wondering if it was worth trying to get the individual amounts transferred by CHAPS too.

I am now going to wait for the cheques to clear.

masonic

tarajayne wrote: »

Bacs is for regular payments, not one-offs,

What system is preferred for low value one-off bank transfers, then? Surely not the cheque?

you will also find that if you try and pay a large sum of money to an individual or company yourself with online banking, it won't let you.

You can normally do these over the phone or in person, though. This isn't a problem with BACS, it's a problem with the security of online banking.

tarajayne

One-off low value payments can still be done by bacs if account to be credited is at another bank but is not worth it because of the fee, I always do it online but it does take 3 days between banks. If at same bank just take money from your account and pay it in the other, if another bank people often draw out a couple of thousand then walk across the road to the bank of the person they need to credit. That way it is instant which is faster than bacs.

You cannot transfer a large sum of money to someone elses account over the phone, you have to do it in person in branch, and it all comes under money laundering regulations. That is why you can't do it online, the bank has to show it has checked out the person sending it for any suspicious activity on their account.

PosterBoy77

tarajayne wrote: »

Bacs is for regular payments, not one-offs, you will also find that if you try and pay a large sum of money to an individual or company yourself with online banking, it won't let you. Regular payments are more easily tracable and as said before can be stopped at a certain stage, once a chaps payment is gone, then that's it. Solicitors will only accept large payments now by chaps to cover their own money laundering regulations. The checks done in branch also check where the money has come from, not just where it's going.

I thinks some of the "extra effort" is be being hyped. I have made CHAPS transfers on a few occasions as it was cheaper to pay the fee than to loose the interest that you loose from many banks when they undertake BACS transfers. Likewise, I have also made large BACS transfers when I have had to pay other organisations such as HMRC for VAT, where the loss of interest is not a problem.

In all cases no particular questions were asked about the cleared funds in the account, with which the payments were being made.

The restrictions often placed on transfers made via internet banking systems are down to the policies of individual banks. Nothing to do with money laundering regulations, or restrictions of the BACS system.

PosterBoy77

tarajayne wrote: »

One-off low value payments can still be done by bacs if account to be credited is at another bank but is not worth it because of the fee, I always do it online but it does take 3 days between banks. If at same bank just take money from your account and pay it in the other, if another bank people often draw out a couple of thousand then walk across the road to the bank of the person they need to credit. That way it is instant which is faster than bacs.

You cannot transfer a large sum of money to someone elses account over the phone, you have to do it in person in branch, and it all comes under money laundering regulations. That is why you can't do it online, the bank has to show it has checked out the person sending it for any suspicious activity on their account.

I have transferred very large sums over the phone. It has nothing to do with money laundering regulations, just bank policies and procedures. It is obvious it is teh case as every bank seems to have different restrictions!

masonic

tarajayne wrote: »

One-off low value payments can still be done by bacs if account to be credited is at another bank but is not worth it because of the fee, I always do it online but it does take 3 days between banks.

There is no fee for BACS tansfers.

If at same bank just take money from your account and pay it in the other, if another bank people often draw out a couple of thousand then walk across the road to the bank of the person they need to credit. That way it is instant which is faster than bacs.

I'm sorry, but IMHO that's just silly. Even writing someone a cheque seems preferable to me than that. The inconvenience of visiting the bank branch(es) and waiting in line etc just to save perhaps a pound or so in lost interest might be appealing if I did not attach any value to my time. I think I'll stick to using BACS transfers, which take just a couple of minutes to input online, and put up with the loss of a little interest. It would probably cost me more than that just to get the bus into town anyway!

PosterBoy77

masonic wrote: »

There is no fee for BACS tansfers.


I'm sorry, but IMHO that's just silly. Even writing someone a cheque seems preferable to me than that. The inconvenience of visiting the bank branch(es) and waiting in line etc just to save perhaps a pound or so in lost interest might be appealing if I did not attach any value to my time. I think I'll stick to using BACS transfers, which take just a couple of minutes to input online, and put up with the loss of a little interest. It would probably cost me more than that just to get the bus into town anyway!

I think the poster should have said CHAPS. There have been a couple of ocasions when I needed to get money from one bank to another on the same day. BACS takes 3 days, so paying for a CHAPS transfer would be the only electronic way of doing it. However taking cash out for free and depositing it in another bank in the same day is much cheaper if you are close to you bank.

masonic

mikael wrote: »

I think the poster should have said CHAPS. There have been a couple of ocasions when I needed to get money from one bank to another on the same day. BACS takes 3 days, so paying for a CHAPS transfer would be the only electronic way of doing it. However taking cash out for free and depositing it in another bank in the same day is much cheaper if you are close to you bank.

Sure, if you need a same day transfer, BACS isn't an option, but for non-urgent transactions, I don't see the problem with using BACS. I don't think it's only good for regular payments as the poster suggested.

Eyesparky

We were supposed to have same day clearing by now ... the banks and Government seem to have gone quiet on this one. Lots of interest to be made lending money on call etc. for the banks. I lived in Australia for years and got very used to their EFTPOS system where funds were cleared instantly. Seemed like a step back in time when I came back to the UK.

jamesd

That's planned for the end of this year for payments up to 10,000. If work is proceeding on the original schedule banks should currently be finishing internal testing and starting on interoperability testing.

The new European Euro-based system is apparently still going to take multiple days even after the UK transactions will by then be happening in seconds much of the time.