Payment to Wrong Bank account - New Best Practice

keyser666

Good News I think here, Implies that payments can now be recovered as long as no disputes, also no shrug of the shoulders from your bank as well


PAYMENTS COUNCIL
PRESS RELEASE
FOR IMMEDIATE RELEASE
Thursday 24 April 2014

CHANGES INTRODUCED TO HELP CUSTOMERS RECOVER PAYMENTS ACCIDENTALLY SENT TO THE WRONG ACCOUNT

People who accidentally send a payment to the wrong account can expect consistent, standardised and swifter help from May 2014, following the publication of a Code of Best Practice by the Payments Council today. For the first time, under the new voluntary Code, banks and building societies have put in place standard central processes and defined maximum timescales to help customers recover money.

What customers can expect:
· When a customer notifies their bank or building society that they have made an electronic payment to the wrong account, action will commence on the customer’s behalf within a maximum of two working days.
· If a bank is unable to reclaim funds immediately - for instance if the recipient disputes its return – the customer will be notified of the outcome of their bank’s investigation in a maximum of twenty working days from the point of enquiry and in many cases much sooner.
· If funds cannot be recovered through the standard central process customers will be given clear and accurate information on the options they have available to them - such as court action against the recipient.
· Banks and building societies will ensure the design of online, mobile and telephone payment channels reduce the risk of a customer making a mistake. This might involve: customers being asked to input account details twice; extra warnings about using the correct account details; or prompting customers to check payment details that have not been used for some time so that they can be updated or deleted as necessary.
· If a customer does not get the service they should expect under the new Code, they should firstly follow their provider’s formal complaints procedure, and failing a satisfactory outcome, take their complaint to the independent Financial Ombudsman.

The new Code cannot guarantee a customer will always recover any money paid in error but it will make sure that the customer knows the outcome quickly and consistently, and enable them to seek legal advice or take further action if required. The new Code will be monitored, and the number of customers using it tracked, to assess whether further refinements are needed.

Adam & Company, Barclays, Clydesdale Bank, Coventry Building Society, Coutts, HSBC Bank plc, Lloyds Banking Group, Nationwide Building Society, NatWest, Santander UK plc, Tesco Bank, The Co-operative Bank, The Royal Bank of Scotland and Yorkshire Bank have signed up to the new Code and are updating their procedures accordingly. Others are expected to announce their participation in the coming months.

Adrian Kamellard, Chief Executive of the Payments Council, said:
“Sending a payment with the wrong sort code or account number is like sending a letter with the wrong post code and address – it won’t reach its intended destination and can be very difficult to get back. The overwhelming majority of the millions of payments we send each day reach their intended destination without any problem, but if you are unlucky enough to make a mistake this new process should help.”

Research conducted by the Payments Council found that less than two out of three (63%) of Brits know their electronic payments are addressed using the sort code and account number. Almost half (49%) incorrectly thought the name of the recipient is checked, while 15% wrongly believed the recipient’s post code is checked.

In addition to the Code, the Payments Council has updated its consumer education website PayYourWay.org.uk with tips to help customers avoid making mistakes when sending a payment:

· Always double check the sort code and account number when sending a payment. This is the only information used to address your payment.
· Check the amount and payment reference, particularly if you are paying a business or paying a bill.
· Once a payment has been sent it isn’t possible to automatically reverse it. If you think you have sent a payment to the wrong account it is important to act quickly and contact your bank immediately.
· Likewise, if you have received money into your account that you think might have been sent to you in error, contact your bank immediately.

ENDS

Populus carried out a nationally representative, weighted survey of 2,075 consumers from 22-24 November 2013.

The ‘Misdirected Payments Code of Best Practice’ is available to view on the Payments Council website: http://www.paymentscouncil.org.uk/current_projects/misdirected_payments/the_code_of_best_practice/-/page/2874/

For further information contact the Payments Council press office: 020 32178441/ 8340/ 8251/8368
Out of hours contact 07811 113 075
[EMAIL="press@paymentscouncil.org.uk"]press@paymentscouncil.org.uk[/EMAIL]
Twitter: @paymentscouncil

NOTES TO EDITORS

Delivering these changes has involved the electronic payment schemes, Faster Payments and Bacs, agreeing to a new ‘Credit Payment Recovery’ process. The new process will apply no matter how the payment is initiated - whether online, over the phone or in a branch.

About Payments Council
The Payments Council is the body with responsibility for ensuring that payment services work for all those that use them in the UK. This unique role ensures that we listen to a wide range of stakeholders to drive innovation in payments and implement change so that individuals and businesses have access to payments for their current and future needs. We are, by nature, a collaborative body so we work with the financial institutions in the payments industry as well as listening to the voices of our external stakeholders.

The Payments Council has three core objectives: to have a strategic vision for payments and lead the future development of co-operative payment services in the UK; to ensure payment systems are open, accountable and transparent; and to ensure the operational efficiency, effectiveness and integrity of payment services in the UK. The Payments Council recently launched the new Current Account Switch Service and on April 29th is delivering Paym, a new mobile payments service that will make it possible to make account-to-account payments by mobile, without sharing account details.
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debbiereynolds76

This is great news on paper. Lets hope the banks implement in full and in the spirit of the code.

bod1467

Considering even getting chargebacks and section 75 claims properly handled can be a challenge (i.e. getting past front-line staff), then I'm not going to hold my breath waiting to see if this works.

Blackbeard_of_Perranporth

All good, but is still reliant on the recipient not disputing that the transaction was correct, having the funds available to reverse the transaction and being co-operative.

Still, the onus is on the sender, in the first instance

keyser666

addendum just received on the press release:

[FONT=&quot]Further to the below press release, please note that the original list of banks that have committed to signing up for the Code was incorrect – Yorkshire Bank were mistakenly listed, and Ulster Bank were omitted. The correct version is immediately below:[/FONT]
[FONT=&quot] [/FONT]
Adam & Company, Barclays, Clydesdale Bank, Coventry Building Society, Coutts, HSBC Bank plc, Lloyds Banking Group, Nationwide Building Society, NatWest, Santander UK plc, Tesco Bank, The Co-operative Bank, The Royal Bank of Scotland and Ulster Bank have signed up to the new Code and are updating their procedures accordingly. Others are expected to announce their participation in the coming months.
[FONT=&quot] [/FONT]
[FONT=&quot]Apologies for any inconvenience. The rest of the information remains accurate.[/FONT]
[FONT=&quot] [/FONT]

Johno100

If this down to 'finger trouble' by the sender, then shouldn't there be modulus checking (a check digit) incorporated into the account number and sort code to prevent the payment going through?

FormulaDriven

When I pay online, my bank asks me for the name of the account, so it amazes me that it's not used. Why can't the receiving bank be told the intended payee and then throw a query if the account number doesn't match?

To use the above "posting a letter" analogy, if you address a letter incorrectly then there is some hope that the fact the letter doesn't have the name of the person living there at the top would prompt the more honest person to return to sender!

CKhalvashi

FormulaDriven wrote: »

When I pay online, my bank asks me for the name of the account, so it amazes me that it's not used. Why can't the receiving bank be told the intended payee and then throw a query if the account number doesn't match?

To use the above "posting a letter" analogy, if you address a letter incorrectly then there is some hope that the fact the letter doesn't have the name of the person living there at the top would prompt the more honest person to return to sender!

I'm amazed that this isn't built into the banks systems if I'm honest, however to check every query would probably cost too much from the banks POV.

I know it can be done, however, as HSBC pinged a payment back to me, as the account name wasn't in Cyrillic when it reached Russia, then refused to send in cyrillic from the UK, but I think that was more the receiving bank being fussy, rather than it being HSBC's fault.

CK

keyser666

Blackbeard_of_Perranporth wrote: »

All good, but is still reliant on the recipient not disputing that the transaction was correct, having the funds available to reverse the transaction and being co-operative.

Still, the onus is on the sender, in the first instance

Agree BoP but one would hope they notice just as they sent it or after they have sent it and confirm receipt of the payment to the recipient. That window you would probably get it back.

What it doesn't say though is if they reclaim it if it is there or ask the account holder if they dispute it (which it alludes to) which gives rise tot hem to dispute it if they are now aware of the new code of conduct. As to the reasons why they dispute it, who decideds if that is a alid dispute? The receiving bank? The sending bank etc etc.

Johno100 wrote: »

If this down to 'finger trouble' by the sender, then shouldn't there be modulus checking (a check digit) incorporated into the account number and sort code to prevent the payment going through?

I dont see why they dont ask you to confirm the sort and account number on another screen by way of typing them in again, job done (unless the details have been recorded wrongly)

FormulaDriven wrote: »

When I pay online, my bank asks me for the name of the account, so it amazes me that it's not used. Why can't the receiving bank be told the intended payee and then throw a query if the account number doesn't match?

To use the above "posting a letter" analogy, if you address a letter incorrectly then there is some hope that the fact the letter doesn't have the name of the person living there at the top would prompt the more honest person to return to sender!

It hasnt been used for a good few years now, it was a manual process to confirm the batch of incoming payments and took days, easier for them let them all come in and deal with the ones that are disputed

FormulaDriven

I see there's more discussion of this on the banking sub-forum.

I'm too new to post links but look for MSE Michael's thread on Budgeting & Bank Accounts

Valli

keyser666 wrote: »

addendum just received on the press release:

[FONT=&quot]Further to the below press release, please note that the original list of banks that have committed to signing up for the Code was incorrect – Yorkshire Bank were mistakenly listed, and Ulster Bank were omitted. The correct version is immediately below:[/FONT]

Adam & Company, Barclays, Clydesdale Bank, Coventry Building Society, Coutts, HSBC Bank plc, Lloyds Banking Group, Nationwide Building Society, NatWest, Santander UK plc, Tesco Bank, The Co-operative Bank, The Royal Bank of Scotland and Ulster Bank have signed up to the new Code and are updating their procedures accordingly. Others are expected to announce their participation in the coming months.

[FONT=&quot]Apologies for any inconvenience. The rest of the information remains accurate.[/FONT]

Ironic really - all about inputting correct information and they don't even know who has, and hasn't, signed up to the new code:)