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Faster Payments a factor in switching bank accounts - survey

20 July 2015  |  7673 views  |  4 Online Shopping

Connection to the Faster Payments Service could be a deciding factor for Brits looking to switch bank account providers, according to a survey commissioned by ACI Worldwide.

Of 2000 people surveyed by YouGov for ACI Worldwide, almost half (45%) say that the promise of a faster and more convenient electronic payment service would encourage them to move their account to a different bank.

The research also shows the increased expectations and appetite among UK consumers when it comes to online payments. Nearly 40% expect to reach recipients' accounts immediately or within five minutes. Meanwhile the majority of consumers would like to see immediate payments for utility bills (65%), credit card bills (60%) and payments to family and friends (66%).

Meanwhile, the study shows that payment delays are a major irritation for a third of UK bank account holders, ranked only behind the fees for ATM withdrawals (55%) and credit card transactions (52%).

The Faster Payments scheme was set up in 2008 and currently has 11 members who connect directly, with a further 400 Payment Service Providers accessing the platform indirectly through a sponsor bank. Recently, with the new payments regulator looking to expand availability, ACI Worldwide was one of six fintech firms to sign up to develop aggregation services for payment service providers looking to plug into its platform.

Yet despite the growing involvement of providers and the positive response of some consumers, the study shows that there is still some confusion among the general public as to how quick the service is, suggesting that banks are not promoting their FPS involvement enough. Under the FPS, a direct payment between two current account holders takes just 15 seconds but the survey showed that eight per cent of respondents still expect payments to take up to two to three days.

"This clearly shows there is a need for greater transparency regarding the service levels being offered by banks, so that consumers can make informed decisions and select the right current accounts and banking providers to meet their needs," says Barry Kislingbury, lead services consultant, Consumer Banking Europe at ACI Worldwide.

"Banks that offer electronic payments in seconds or minutes would seem to have an important differentiator that they are not fully exploiting today."

Comments: (4)

A Finextra member
A Finextra member | 20 July, 2015, 15:12

I fail to see how public not knowing about Faster Payments will help them make an informed decision about switching banks.

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Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 20 July, 2015, 17:08

"Under the FPS, a direct payment between two current account holders takes just 15 seconds but the survey showed that eight per cent of respondents still expect payments to take up to two to three days." If that means 92% expect such a payment to take only 15 seconds, there's nothing to complain about. I thought the % of customers who even know about FPS would be much lower than this extremely high figure.

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A Finextra member
A Finextra member | 21 July, 2015, 09:14

"Could be"

"Seem to"

Not exactly definitive then, unlike the headline

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A Finextra member
A Finextra member | 21 July, 2015, 11:30 The survey is saying that, for almost half the respondents, a reliable, and fast payments service is a factor to consider as part of a decision to switch. With challenger banks entering the fray as directly connected participants, we could finally start to see some account switching traction, which is what regulators have been hoping for.
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