The Faster Payments system (sometimes referred to as FPS) is not just a regular payment system, but one of the few UK interbank payment systems that enables payers to make instant payments. Instead of waiting days for transfers, users can send funds instantly, and FPS will process payments the same day. In this guide, we’ll explain what Faster Payments really are, how they work, and how they compare to other systems.
What is the Faster Payments Service (FPS)?
The Faster Payments service is a United Kingdom-based payment system introduced by the UK Payments Council (now Pay.UK) in 2008. From the very beginning, Britain’s financial institutions wanted to establish a system for non-scheduled, immediate payments only. In practice, the service was severely limited by the implementation, as not every bank was willing to adopt it.
Consequently, the new instant payments idea underwent a lengthy journey to reach today’s standards.
Nowadays, FPS allows real-time payments between bank accounts, typically within seconds. A faster payment system supports a wide range of payment types, including personal transfers, business payments, standing order payments, and mobile or online transactions.
How do Faster Payments work?
Sending a Faster Payment is simple:
A person initiates a transfer through web banking, a mobile banking app, or telephone banking.
The payment message is sent securely through the Faster Payments system.
The recipient’s bank account is credited within seconds, although it may take up to two hours in some cases.
After that, both the sender and recipient receive confirmation that the payment has been successfully processed. The service operates 24/7, 365 days a year, ensuring payments are processed even on weekends and holidays, allowing anyone to receive faster payments.
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Benefits of Faster Payments
The short version would be like this:
Speed: Funds are usually delivered instantly compared to traditional banks’ seven-day transfers.
Cost: Most banks provide Faster Payments free of charge for individuals.
Availability: The system runs 24/7, 365 days a year.
Convenience: Ideal for paying bills, online shopping, or quick peer-to-peer transfers.
Speed is not just a benefit; it is a cornerstone of the Faster Payment System. It usually arrives within seconds and rarely takes more than two hours to arrive. It makes it the preferred method for anyone who needs an instant bank transfer in the United Kingdom.
Another major advantage is cost. Most banks and building societies offer Faster Payments free of charge for individuals, while businesses benefit from very low fees compared to high-value systems like CHAPS or SWIFT. Combined with full availability: 24 hours a day, seven days a week, including weekends and holidays, creating an unmatched convenience for anyone.
Security is another important factor. The Faster Payments scheme includes fraud checks and monitoring to protect both payers and recipients, backed by the power of British jurisdiction.
To be clear, Faster Payment System is operated by a private entity, and the central bank of the United Kingdom – the Bank of England is not a direct participant, but it is responsible for providing final settlement and overseeing the payment system for safety and stability.
Faster Payments limits and restrictions
The Faster Payments Service does have some limitations:
• Transaction limits: The scheme allows up to £1 million per transfer, though many banks set lower limits.
• Bank coverage: Almost all UK banks and building societies support FPS, though some smaller institutions use indirect access.
• Possible delays: Payments may occasionally be held for fraud checks, compliance reviews, or if they exceed the bank’s transaction limits.
Despite these constraints, FPS remains the UK’s main real-time payment system for sending money in British pounds.
Faster Payments vs other payment systems
The Faster Payment system is surely quick and very flexible, but not always the best option; besides, other payment systems are also good enough. For example, BACS payments are commonly used for payroll and bulk processing due to their cost-effectiveness, whereas CHAPS is more suitable for high-value transactions. SEPA and SWIFT also have their upsides, so let’s compare all these big payment services at once.
System | Region | Speed | Typical use case | Limits | Cost |
Faster Payments | UK | Seconds – 2 hrs | Pay bills, online shopping, P2P | Up to £1m | Usually, free or low fee |
BACS | UK | 3 working days | Payroll, supplier payments, standing order | £250,000 per transaction | Low cost |
CHAPS | UK | Same day | High value transactions (corporate deals, final funds for finalizing property purchase) | No upper limit | Higher fees |
SEPA Instant | EU/EEA | Seconds | EU cross-border one off payment | €100,000+ | Low, but depends on a bank |
SWIFT | Global | 1–5 days | International settlements | Varies by each bank | Higher fees plus currency exchange |
How popular is the Faster Payment System? In 2024, the FPS processed 5.09 billion transactions with a value of £4.2 trillion, compared to the Eurozone’s payments shared network – SEPA, which in the first half of 2024 had total retail payment transactions in the euro area worth approximately 52.1 billion transactions, valued at €25.1 trillion.
Faster Payments for businesses
Businesses benefit greatly from access to fast-moving and consistent funds.
Use cases: Paying suppliers, processing refunds, payroll, and receiving customer payments.
Advantages: Faster cash flow and improved customer trust.
Limitations: For large, international transfers, systems such as SWIFT or CHAPS may be more suitable, and euro-related payments would be more closely aligned with SEPA regulations.
The cumulative effect of the system enhances cash flow for businesses, enabling them to receive customer payments promptly, settle supplier invoices on time, and issue refunds without delay.
How Genome helps with Faster Payments
While Faster Payments is a UK-specific service, Genome’s business wallet users can accept Faster Payments. Our Intelligent Routing System can also use the Faster Payments option when routing your international transfer.
We offer businesses SWIFT transfers, allowing them to receive and send payments in USD, GBP, EUR, PLN, CHF, JPY, CAD, CZK, HUF, SEK, AUD, and DKK.
Additionally, all our clients can send payments through SEPA Instant and Credit Transfers. As an EU-regulated electronic money institution, Genome offers accounts in EUR, GBP, USD, and 9 more currencies, with:
Affordable SEPA transfers.
Multi-currency support with easy account management via the web version or the Genome app.
A secure Visa debit card (physical and virtual options available) linked to your account for everyday use.
24/7 access to funds with fast and reliable payment services.
Both Faster Payments and SEPA Instant allow users to avoid delays and improve financial flexibility.
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FAQ
What are Faster Payments in the UK?
The Faster Payments system is a United Kingdom-based real-time system that enables near-instant transfers between bank accounts using the British pound as the currency.
What is the limit for Faster Payments?
The Faster Payments limit is up to £1 million, though the exact amount depends on your bank or provider.
Do Faster Payments work on weekends?
Yes, Faster Payments work 24/7, including weekends and holidays.
Are Faster Payments available internationally?
No, Faster Payments is a UK-only service. For faster and instant payments, typically used payment services include SEPA Instant or SWIFT.
