Payment Services Directive

[Gardian]

We've just received one of those periodic letters from our UK clearing bank detailing changes to account terms & conditions.

To be honest, I don't normally take much notice of these missives, but something in the covering letter caught my eye. It talked of the PSD which is being brought in by the European Commission. "The good news is that after November 2011, most payments should reach the recipient's account by the next working day", says the letter.

Now perhaps naively, I'm wondering whether this will mean an end to the scandal of our bank over here (CA) holding on to our monthly transfer from HIFX by at least 2 working days, and 4 if a weekend intervenes? I feel that it's a scandal because IBAN no's are used by all money brokers and they assure me that transferred funds from them are effectively 'cleared funds' and there should be no need for dely in crediting to a customer's account.

Furthermore, might this put UK clearing banks back in to the market for regular transfers? It depends on their rates and charges of course, but it's only a short step for them to adopt the role that the money brokers currently fill, i.e. buy a year's worth of funds upfront at whatever rate and remit monthly.

I don't want to turn this in to a 'this is the best way to transfer your money' debate: that's been done to death and everybody uses the method that works for them. I'm just interested in whether this is a welcome move to facilitate instantaneous transfers for which the technology has seemingly existed for years and which the banks have dragged their heels over.   

[AnOther]

'Most' and 'should' are the get out clauses, I'll believe it when I see it [blink]

Why would you want to buy a years worth of funds and remit monthly, what is the point ?

[tonyinfrance]

I pay my credit card bills by phone via Barclays, who told me this week that payments of less than £10k are transferred same day/next day, no longer the 3-4 working days it used to take.......

[Gardian]

[quote user="AnOther"]'Most' and 'should' are the get out clauses, I'll believe it when I see it [blink][/quote]

Well I agree, but having now read the t & c's, it says clearly that "The bank receiving the payment from us is required by law to pay it in to the customer's account on the day it receives the payment from us". So, on face value, good news indeed.

[quote user="AnOther"]Why would you want to buy a years worth of funds and remit monthly, what is the point ?[/quote]

Fixing a monthly sum for a year and knowing that whatever fluctuations occur, that's what you'll receive. With the falling £ over the last five years, I've probably done well with it and am currently 'enjoying' my euros at a fix of 1.17 done last October. I'd settle for getting that now for a further year!

 

[AnOther]

Still sceptical but let's wait and see.

I understand buying a years worth of Euros, I do it myself, but what is the advantage of drip feeding them, less temptation to spend perhaps, and where are you holding them in the meantime, with the broker ?

[Gardian]

I'm not holding them.

I simply enter in to a contract to buy (say) €20k at whatever rate is on offer at the time (typically 3 pts below interbank rate) and the £ equivalent is direct-debited from my UK bank a/c monthly. The euros follow, although with the delay described above.

It's not drip-feed: it's our monthly pay cheque. 

[AnOther]

Sorry, I took [quote user="Gardian"]buy a year's worth of funds upfront[/quote] to mean exactly that, not that you had just fixed a rate for 12 months [;-)]

[tinabee]

Just found this website which explains all the different types of payment and how long they take.

http://www.ukpayments.org.uk/payment_options/

Also something on PSD and SEPA

http://www.ukpayments.org.uk/payment_options/cross_border_payments/