Everything you need to know about Bacs payments - what is it, how long does it take, how much bacs payments cost, alternatives such as Faster Payments or CHAPS.
A Bacs payment is a bank transfer from one bank account to another bank account, taking three business days to arrive. However, a Bacs payment can also be a Direct Debit, which is the opposite of a bank transfer - meaning a business pulls money out of a bank account with relevant permission of the other party. Bacs payments are not same-day payments or instant, but it is still the number one bank payment type businesses use in the UK.
A Bacs payment takes three days to arrive, and is only sending on business days. There are multiple options to get connected to Bacs, either through your business bank or through a Bacs bureau. In any case the Bacs cycle starts with a file submission, which has to be submitted up until a certain cut-off time and gets sent on the third business day.
The payment normally arrives very early in the morning on the third day, usually by about 7am. Beware, only Monday to Friday, even though it is a electronic payment system it takes non-working days off.
A Bacs payment is the cheapest way to send payments. It only costs a few pennies, mostly depending on the volume and the bank, or Bacs bureau. When sending say 1,000 plus payments monthly this should be less than 10p, also watch out for hidden bank charges such as:
Bank to bank payments can also be made through the CHAPS and the Faster Payments system. CHAPS are same day payments for high value transfers which cost about 20-30 pounds per transfer. Faster Payments are instant payments from bank-to-bank for payments up to the value of 250,000 pounds per transfer.
You are probably aware that keying in payments individually is a nightmare and that you wish you could just import a pay run for your business or clients.
This is now possible using a pay run importer like Telleroo that works with most accounting software files and banking files.
Import payments, schedule and fund, without the hassle of manually keying in your payments.