Introduction

If you have Standing Orders, Direct Debits or Future-Dated Payments going out of your account you can potentially benefit from a ‘retry’ process that was introduced across the banking industry in September 2014.

Standing Orders, Direct Debits and Future-Dated Payments are collectively known as ‘pre-notified payments’. The introduction of the retry process means that when one of these types of payment fails because of insufficient funds in your account, you have until 2pm - as a minimum - to pay cleared funds into that account to cover the payment when it is subsequently ‘retried’ by your bank or building society later that same day.

Introduction of the retry process is the result of a collaborative banking industry initiative, brought about in response to customer-demand. It builds on an agreement reached in June 2013 between the Financial Conduct Authority (FCA) and seven of the UK’s biggest high street banks for them to use a same-day retry system.

 

The Retry Process 

Early hours of the morning:
payment fails due to insufficient
money in the customer’s account

Before bank/building society cut-off time:
customer pays in cleared funds

Post cut-off time: payment retried by
bank/building society

Payment successful

 

Key Facts

  •  Avoid charges and fees
    You have until 2pm that day - as a minimum - to pay cleared funds into your account to meet a failed payment before it is subsequently ‘retried’ later the same day. By doing this you will avoid late payment charges or unpaid item fees that you may otherwise incur. Previously, a ‘bounced’ payment would not have been retried and it is likely that you would have incurred a late payment charge or unpaid item fee, as well as the possible loss of service or non-delivery of goods as a result of a payment of this nature not being processed.
  • Cut-off time may be later than 2pm
    All participating banks and building societies will give you until at least 2pm to pay cleared funds into your account. But banks and building societies may compete on this aspect, with some potentially offering a cut-off time later than 2pm. You should contact your bank or building society to confirm what the cut-off time is for you.
  • Cheques
    The new process should be viewed as a ‘safety net’ rather than a service to regularly use in a proactive manner, and it only covers automated payment that are pre-notified. Cheques, for instance, would not be ‘retried’ as part of this new process. However, banks and building societies can compete on this - so some may choose to include cheques as part of their individual retry process.

 

Banks and building societies involved:
 

ADAM & COMPANY

Intelligent Finance

Allied Irish Bank (GB)

LLOYDS

BANK OF IRELAND

M&S Bank

BANK OF SCOTLAND

Metro Bank

 BARCLAYS BANK PLC

Nationwide Building Society

CLYDESDALE BANK PLC

NATIONAL WESTMINSTER BANK PLC

CO-OPERATIVE BANK PLC

ROYAL BANK OF SCOTLAND  

COUTTS

SANTANDER UK  

Coventry Building Society

Tesco Bank

Cumberland Building Society

TSB

DANSKE BANK

ULSTER BANK LTD

First Direct

 Virgin Money Plc

First Trust Bank

Yorkshire Bank

 HALIFAX

 

Handelsbanken

 

HSBC BANK PLC

 

HSBC PRIVATE BANK (UK) LIMITED

 

 

Tips to help you manage your account

Although the retry process provides a safety net if you miss a payment due to insufficient funds, it makes sense to have cleared funds in your account so your payments can be met at the first time of asking. This will help you avoid potential late payment charges for any of your bills. If you find that you are having problems regarding how you manage your account, the following tips can help you:

  • Check your balance regularly to help make sure there’s enough money in your account to cover any Standing Orders, Direct Debits and Future-Dated Payments.
  • If your Direct Debits, Standing Orders or Future-Dated Payments are leaving your account on an inconvenient date, review your monthly incomings and outgoings and move your payments so that they leave your account on a more suitable day.
  • The fastest way to get cleared funds into your account is by paying cash in to your own bank or by making a Faster Payment. (If you make a payment via phone or online banking the payment will generally go through as a Faster Payment. However, you should check this with your bank or building society if your payment is for more than £10,000.)
  • If you are worried about timescales for making an important payment you should get in touch with your bank or building society.
  • Payments UK has more information about payment timescales on its consumer website at: www.payyourway.org.uk.

 

In 2014 in the UK there were:

3.7 billion Direct Debit payments
349 million Standing Order payments
159 million Future-Dated Payments

 

Frequently asked questions

  • The retries process covers ‘pre-notified payments’, i.e. Standing Orders, Direct Debits and Future-Dated Payments. Other types of payment, such as cheques, are not generally included, but some banks and building societies may choose to include them as part of their individual retry process.
  • The fastest way to get cleared funds into your account is by paying cash in to your own bank or building society or by making a Faster Payment. (If you make a payment via phone or online banking the payment will generally go through as a Faster Payment. However, you should check this with your bank or building society if your payment is for more than £10,000.)
  • This is up to individual banks and building societies. If you want to be notified by your bank or building society then you should contact them to find out if they do this. If they do not you may want to consider alternative options or shop around to ensure you are with a bank or building society that best suits your needs.
  • If the funds don’t clear before the retry takes place then the Standing Order, Direct Debit or Future-Dated Payment will not be processed. You may incur an unpaid item fee or charges due to being or going overdrawn. In addition, any goods or services that the payment relates to may be impacted. (For example, if a Direct Debit is not processed this could lead to the Direct Debit originator withdrawing the service they were providing.
  • You should contact your bank or building society to understand what your options are in terms of the payment channels open
    to you and the cut-off times for each. Typically, the fastest way to get cleared funds into your account is to pay cash in to your own bank or building society or by making a Faster Payment (see page six for more details).
  • In the first instance you should make a complaint to your bank or building society using their official complaints procedure. If the matter is still not resolved to your satisfaction then you can take your case to the Financial Ombudsman, an independent body that settles disputes between financial organisations and their customers.
  • You should contact your bank or building society to understand what your options are in terms of the payment channels open
    to you and the cut-off times for each. Typically, the fastest way to get cleared funds into your account is to pay cash in to your own bank or building society or by making a Faster Payment (see page six for more details).
  • Your bank or building society’s cut-off time is likely to be on its website or you could contact them and ask via an advertised phone number.