MSE News: Customers being 'ripped off' by banks on Faster Payments limits

agrinnall

While it's not at all unusual for MSE articles to be a load of tosh this one has to take the biscuit for inaccuracy. They really need to take it down and get it rewritten by someone who either knows the truth or has the ability to do the research properly. Although of course then they'd have to remove most of the accusations so wouldn't meet the publicity needs that must be behind writing it in the first place.

chambta

This article is a shocker.

Must do better MSE.

Armorica

Archi_Bald wrote: »

I think MSE misunderstand CHAPS payments. There has never been a limit to individual CHAPS payments. Thus there is no need to make five or six CHAPS transfers, one is enough.

Exactly this (almost) - some banks will apply 'item' limits but they would be likely to be in the millions.

The limit is an 'online' one. You should be able to send money via FPS if you speak to your bank/visit the branch. (And please let me know how many houses there are now for less than 100k!)

If it is your broker/solicitor etc. making the payment, personal limits wouldn't necessarily apply.

On special clearance, that was essentially to confirm that funds were available (i.e. it would not bounce for lack of funds). The cheque could still be dishonoured for other reasons e.g. forgery, signature not matching, written in pencil etc. (But these are rather less common)

For business online banking, then you can find that the automatic switch from FPS to CHAPS will happen based on the value. But CHAPS doesn't tend to appear on personal internet banking (but international payments can).

jimjames

Archi_Bald wrote: »

Agree, this would be an option at most banks.

Also many, if not all, banks actually allow you to make several faster payments on the same day. The limit is just per transaction.

Yes, frustrating but also manageable.

My bank has a limit for not needing authorisation with the annoying card machine. So I can't transfer £1000 but can do 4 transfers of £250.

jimjames

As I understand CHAPS is a totally different process and allows batching of payments and other features that are required for property transactions and that the consumer based FP service doesn't support.

zerog

Archi_Bald wrote: »

If you opt for the faster payment option, expect that the Santander AML procedures will kick in and all of the payments will be delayed to probably the next working day. Talking to them beforehand might eliminate the delays on the individual payments but won't raise the daily max on Faster Payments.

Talking to Santander is not going to help, it will only result in getting your online banking suspended more quickly.

Just accept that Santander's FPs literally arrive on the next working day if there is no history of sending payments of a certain value to a certain payee. And that if you receive an automated phone call from an 0845 number at 0830 the next morning, you should answer it and answer the questions.

If you do the FP in a branch (and comply with their ID requirements) that is likely to avoid any delay.

It's possible to be hit with multiple CHAPS fees if you need to send the money from several sources into one account and then to the solicitor. (I don't see the problem with keeping more than £85k in an account temporarily if one is doing this sort of thing)

The way to do it is to be clear with the solicitors how all this is going to work before instructing them. Otherwise you shouldn't be worrying about £25 if you would have stuck with these particular solicitors even if their fee was £25 more...

atypical

jimjames wrote: »

As I understand CHAPS is a totally different process and allows batching of payments and other features that are required for property transactions and that the consumer based FP service doesn't support.

Most of the front end features of FPS and CHAPS are the same. The back office is much more automated with FPS. The other major difference is that CHAPS is based on real time gross settlement and FPS on net settlement at three points during the day. This increases settlement risk which is one reason (among many) there is some reluctance to increase the scheme limit above £100k.

busabus

Archi_Bald wrote: »

I think MSE misunderstand CHAPS payments. There has never been a limit to individual CHAPS payments. Thus there is no need to make five or six CHAPS transfers, one is enough.

Well, from experience, buying a house does result in multiple transactions, at a minimum deposit and final settlement.

I think some banks are ripping people off because there is a zero cost system available and they have chosen to put a lower limit on it that forces more people to pay. There's no practical reason to put that lower cap in place, so why else are they doing it? To make money! And who does it affect? Most people wouldn't think about these charges when they open their first bank account so it punishes the ignorant and lazy. I can happily use those terms as they apply to me, I wasn't aware there are other banks that don't charge for transfers between £10k and £100k before this article.

So, it's just another reason to switch banks. Thanks MSE!

Archi_Bald

busabus wrote: »

Well, from experience, buying a house does result in multiple transactions, at a minimum deposit and final settlement.

That is an entirely different matter, and not an issue that the MSE article addresses. Nor does it mean you must use chargeable payment methods.

busabus wrote: »

I think some banks are ripping people off because there is a zero cost system available and they have chosen to put a lower limit on it that forces more people to pay.

You haven't read the comments posted earlier. Nobody is forced to use CHAPS instead of FP, and it is incorrect that the per transaction FP limit is the daily FP limit.

The term "rip-off" is increasingly used on this forum as a substitute for "not really sure about the facts but let's just attack the banks".

busabus

busabus wrote:

Well, from experience, buying a house does result in multiple transactions, at a minimum deposit and final settlement.

Archi_Bald wrote: »

That is an entirely different matter, and not an issue that the MSE article addresses.

Yes it does! Twice it mentions buying a house and multiple payments. That's why there are multiple CHAPS payments. It's not a misunderstanding of the system.

Archi_Bald wrote: »

Nor does it mean you must use chargeable payment methods.

You haven't read the comments posted earlier. Nobody is forced to use CHAPS instead of FP, and it is incorrect that the per transaction FP limit is the daily FP limit.

Yes I have, and I'm telling you, for me to get my money from HSBC to my solicitor I HAD to pay for two CHAPS transactions, there was no alternative. If I used a different bank I could have used FP and I wouldn't have had to pay.

Archi_Bald wrote: »

The term "rip-off" is increasingly used on this forum as a substitute for "not really sure about the facts but let's just attack the banks".

I still think that if you can get exactly the same service for free somewhere else then it is a "rip-off"!