The same day retry system will stop you receiving unnecessary penalty fees when using the Faster Payments process. We explain what this means for bank payments.
What currently happens
Through Faster Payments[1], transactions in and out of bank accounts, such as moving money between accounts and paying bills, typically take a couple of hours, at most.
However, banks generally process payments such as Direct Debits, standing orders and future dated bill payments early in the morning. This means that when you pay money into your account or receive your salary later on that day you can be left with an ‘unpaid item penalty fee’.
What will happen now
Now, with the retry system, if your money has not been paid into your account when a Direct Debit, for example, is being taken, the bank will wait until the afternoon and retry the payment before finalising the transaction. This will allow time for the money to clear in your account and the outgoing payment to be made.
These banks will now also clearly explain to you about the time of day that money must be in your account to meet outgoing payments.
For Lloyds Banking Group customers, the bank currently operates a same day retry system on many of its transactions, but is updating its systems to ensure it is used for all transactions. Until this occurs you will be able to claim a refund for related late payment charges.