Faster Payments bank transfer useless for car purchase

mr-b

Hi

I'm buying a used car from a private seller and thought the payment process via bank transfer using the Faster Payment scheme would be quick and easy. Not so!

After several hours waiting for a small deposit to arrive in the seller's account (me First Direct, seller NatWest) and despite the account details apparenlty matching, it seems that Faster Payments is a wishful thinking concept.

On calling FD I was shocked to discover that the vague "subject to checks" catch-all clause means the FP transfer may take up to the end of the next working day! Moreover there is no way to cancel it in the event of a delay, and hence use the funds for a different method. In other words the funds are stuck in limbo.

Obvs this is completely useless for collecting a car where one has travelled and needs the funds to clear immediately before the seller will release the car. So it looks like I'm back to cash, where apparently one has to call First Direct so they can issue a "memo" to the HSBC branch authorising the withdrawal, and then checking with the branch (if they even still allow that these days) that they can fulfil the cash amount. Then of course one has to schlep around with the wad to the seller and go to their bank to pay it in and be verified.

Someone remind me which year it is??? Is there an easier foolproof way?

eskbanker

In most cases Faster Payments between two participating institutions will be practically instantaneous, but the point is that this can't be relied on, so the only commitment made is indeed the 'end of next business day' specified in the Payment Services Regulations.

Where both the sending and receiving bank or building society are direct participants of the Faster Payment System, funds are usually available almost immediately, although they can sometimes take up to two hours.

These timescales can still apply if either the sending or receiving bank is not a direct participant. Some payments will take longer, especially outside of normal working hours.

As a minimum, all financial institutions in the UK must abide by the Payment Services Directive (PSD) –  this states that any payments made by mobile, internet or phone banking (including standing orders) must arrive by the end of the following business day at the latest.

Due to their real-time nature, once sent Faster Payments cannot be cancelled.

https://www.wearepay.uk/what-we-do/payment-systems/faster-payment-system/how-faster-payments-work/

Confusedlad

A "small" deposit of a few thousand pounds should be no problem.  If you're with FD I would have thought/expected a phone call with an explanation would have meant this would have been authorised & gone through no problem.  

I've always found their CS team can override the inevitable checks that even unusually high transfers trigger.  Paying a large balance might take longer, but again a phone call might expedite even this.

Other banks may be less able or prepared to play ball but (if you can get through on the phone!) I would expect most would be sympathetic to your reasons for an immediate transfer?

mr-b

Interesting info tx. The small deposit in this case that was delayed was just £100. FD (who are usually very competent and helpful) said that they could *not* usher through transfers even if contacted by phone in advance. It seems that somewhere there is always an unaccountable computer that can say "no". Understandably they can't give out advice on what to do in certain situations, and are only able to state the position.

I've not tried the cash withdrawal process yet for a larger sum from an HSBC branch. I've no idea whether this also goes through "checks" but presumably there is just a process to check funds are cleared and available before FD issue the memo to the branch. Then the branch will have to have enough cash and staff to dole it out.

Either way it seems if you absolutely need a "faster payment" then going to a branch to withdraw and then pay in cash is the only guaranteed method. With banks closing branches everywhere it seems antiquated that they haven't enabled this type of transaction.

How long does crypto take to clear?

jimjames

mr-b said:

Hi

I'm buying a used car from a private seller and thought the payment process via bank transfer using the Faster Payment scheme would be quick and easy. Not so!

Previously done this with FP and not had any issues so I think you were just unlucky. £1 test followed by £15k and no delay in it being sent/received.

35har1old

jimjames said:

mr-b said:

Hi

I'm buying a used car from a private seller and thought the payment process via bank transfer using the Faster Payment scheme would be quick and easy. Not so!

Previously done this with FP and not had any issues so I think you were just unlucky. £1 test followed by £15k and no delay in it being sent/received.

I was able to pay £1500 to a personal account on the spot from TSB Transfer completed immediately 

Shakin_Steve

I paid over £20,000 from my current account to a car dealership in Sheffield last year, but they sent some kind of link to my phone pre-filled with all the information. The dealership was Carshop, but the link came from their parent company, Sytner.

mr-b

Tx for the experiences.

I called First Direct the next day who were able this time to trace the transaction. It turned out that it hadn't been intercepted and had actually transferred to NatWest almost immediately.  They had accepted it but for some reason it had not showed up in the NW account. DOH!