What are the advantages and disadvantages of Bacs payments?

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Posted on
September 14, 2021
Topics
Bacs payments
Banking

What are the advantages and disadvantages of Bacs payments?

Advantages

  • Bacs payments are the cheapest way to send payments
  • Every payroll/accounting software supports Bacs files

Disadvantages

  • Payments take three days to clear vs instant Faster Payments
  • Bacs payments only clear on business days
  • Strict cut-off times (e.g. Wednesday 3pm to have payments sent on Friday)
Alternatives to Bacs payments

Bank-to-bank payments can also be made through Faster Payments. Faster Payments are instant payments up to the value of £250,000 pounds per transfer, which are cheaper than CHAPS. Most banks charge between £1-5 pounds per Faster Payment.

How to get started with bulk payments

Sending individual payments is simple, mostly free, and accessible to even very small businesses. When it comes to sending more than a handful of payments it becomes more difficult and you are left with three options:

  • Upgrade regular Business Banking to Corporate Banking (eg. Barclays.Net alike)
  • Outsource payment file submissions to payment bureaus
  • Use new web based applications such as the Telleroo Platform

At Telleroo we're committed to end this era of slow and expensive business payments and to eventually level the playing field, making business payments as effortless as consumer payments.