Your rights when making and receiving payments
Bank accounts are often used to make and receive payments, but things can go wrong. Find out your rights when payments are being made to and from your bank account, and how long it should take to receive money or pay it out.
How do I know if money has gone in or out of my account?
Your bank or building society must make the following details available to you for every payment into and out of your account:
- the date of the transaction;
- the amount of the transaction;
- who it was to or from (where appropriate); and
- a reference so you can identify the payment.
In most cases this will be done through a passbook, monthly statement or internet banking.
How long should it take for money to arrive in my account?
If you have a current account, card-based account or instant-access savings account, the funds must be made available to you and start earning interest as soon as the bank receives them if:
- an electronic payment has been made to your account (for example by CHAPS, Bacs or Faster Payments systems); or
- you have paid cash over the counter or transferred money between accounts with the same bank.
For a cash ISA or a savings account with a notice period, the funds do not have to be made available immediately, but the bank must start paying interest on the same business day as it receives the funds.
The full amount of the payment must be credited to your account, unless your bank has agreed with you that charges can be deducted first.
Cheque 2-4-6
When you deposit a cheque into a current account, think 2-4-6. If you deposit a cheque into a savings account, think 2-6-6.
- 2: Interest should be paid after 2 working days;
- 4: You should be able to withdraw the money from a current account after 4 working days; and
- 6: You should be able to withdraw the money from a savings account after 6 working days (depending upon the terms of the account). For current and savings accounts, the money will now be guaranteed and your bank cannot take the amount of the cheque out of your account, even if it is returned unpaid, unless you have acted fraudulently.
The banks have agreed this timetable for cheque clearance. These are not our rules, but should apply in the vast majority of cases. If your cheque does not clear within this timetable, ask the bank to explain why.
Some banks will offer better terms so check with your bank.
Find out more about how to use this guide.
What is the longest it should take for a payment from my account to get to the receiving account?
It depends how you make that payment. However, your bank must tell you the maximum time it will take to make a payment.
If a payment does not arrive in your account or the receiving account by the time you expect, ask your bank to explain what has gone wrong.
Know your rights!
As of 1 January 2012, for all payments in pounds or Euros from your account to another bank in the UK or the EU, your bank must get the money to the receiving bank by the end of the next working day after you have told it to make the payment.
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How can I stop a payment?
You can stop a payment that you have arranged to make from your account but the rules for doing this vary, depending on how you planned to make the payment.
Cancelling a direct debit
A direct debit is an arrangement where you give a company or individual (known as the ‘originator’) permission to take money regularly from your account.
Under the Direct Debit Guarantee Scheme, the originator must tell you in advance if there is a change in the amount or date of the payment. You are guaranteed a full and immediate refund if the originator or your bank, makes an error.
You can cancel a direct debit by writing to your bank or using your internet or telephone banking service. It is a good idea to also notify the originator.
Cancelling a standing order
A standing order is an instruction you give your bank to regularly pay a set amount to another account.
You can instruct the bank to cancel a standing order by writing to it or using your internet or telephone banking service. The latest you can cancel a standing order is before close of business on the working day before payment is due to be made.
Know your rights!
If you have contacted your bank in time, and a payment is made after you have told it that you wish to stop the payment being taken from your account, it will be regarded as an unauthorised transaction and your bank must give you an immediate refund.
Stopping a cheque
If a cheque has not been paid you can stop it by writing to your bank, or using your internet or telephone banking service.
Cancelling a regular card payment
When you give your credit or debit card details to a company and authorise them to take regular payments from your account, such as for a gym membership or magazine subscription, it is known as a ‘recurring transaction’ or ‘continuous payment authority’.
These are often confused with direct debits, but do not offer the same guarantee if the amount or date of the payment changes.
In most cases, regular payments can be cancelled by telling the company taking the payments. However, you have the right to cancel them directly with your bank or card issuer by telling it that you have stopped permission for the payments. Your bank or card issuer must then stop them – it has no right to insist that you agree this first with the company taking the payments.
Be aware though that you will still be responsible for paying any money that you owe.
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Find out more about how to use this guide.
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