Faster Payments and Bacs improve wrong payment recovery
There’s good news for the fat-fingered among us (or those who simply attempt to execute online banking using a tablet). Faster Payments, the company whose logo you may have notice flash by whenever you’ve made a purchase on Amazon or transferred funds from one bank account to another, and Bacs Payment Schemes Limited have announced improved measures for those wishing to recover their money in the case of accidently sending it to the wrong account.
What are these measures?
These measures were last looked at back in May 2014. In some cases they remain as they were. In others, they have been tightened considerably. Here they are in full:
- When notifying your bank or building society of a wrong payment, your bank will commence action on your behalf within a maximum of two working days.
- Where your bank finds clear evidence of a genuine mistake, they will contact the receiving bank on your behalf with a request to prevent the money being mistakenly spent. Providing this is not disputed, you will receive a refund within 20 working days from the point of your enquiry
- In cases where the circumstances of the claim are not clear, your bank will still contact the receiving bank on your behalf. The recipient will be contacted by their bank to ask for consent to debit their account. No funds will be removed without the consent of the receiving customer.
- If it isn’t possible to reclaim a payment sent in error – for instance, if the recipient disputes its return – you will be notified of the outcome within 20 working days from the point of your enquiry or sooner.
- If funds cannot be recovered through the standard central process your bank will give clear and accurate information on your options, such as court action against the recipient.
- If you don’t receive the service expected under the new procedures, you can follow your provider’s formal complaints procedure. If you’re not happy with the outcome, your bank will provide you with information on how you can take your complaint to the independent Financial Ombudsman Service.
Of course, prevention is the best solution of all.
Craig Tillotson, chief executive of Faster Payments says: “Mobile, online and phone banking customers now send well over a billion payments every year. The most important advice is to make sure you get the sort code and account number correct when sending any payment.
“But, if you do make a mistake, today’s announcement means more help is on offer, while also ensuring the recipient of funds is treated fairly too.”
You can also read our guide, 'How to get your financial complaint heard', here.
If you’ve have a complaint about a financial service product you have bought but the company you bought it from refuses to resolve your problem after eight weeks, the Ombudsman can help. The Ombudsman will investigate and resolve the matter. The Ombudsman is independent and its service is free to consumers. The Ombudsman may find in the company’s favour but consumers don’t have accept its decision and are always free to go to court instead. But if they do accept an Ombudsman’s decision, it is binding both on them and on the business.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.
Created in 1968, BACS is a not-for-profit industry body, owned by 16 of the leading banks and building societies in the UK and Europe. All direct debits, standing orders, credit card payments, personal loans and the vast majority of salary cheques are processed through BACS. In 2010, 5.7 billion UK payments with a total value of £4.06 trillion were processed through the system.