Payment Systems in the UK

Question 1

BACS -
What is used for ?
Who manages it ?

Answer 1

The Bacs Payment System
(Bankers Automated Clearing System)
processes Bacs Direct Credits, widely used to pay salaries, benefits, dividends and supplier payments directly into bank accounts, and Direct Debits, which automate the collection of regular payments, the preferred payment method for many UK bill payments.

Question 2

Faster Payment Participants
- 3 types

Answer 2

Directly Connect Settling - perform their own settlement with BoE

Directly Connect Non-Settling - perform settlement via a sponsoring participant that acts as a proxy

Indirect payment service provider (PSP) - a sponsor participant manages connection and settlement on the PSP’s behalf

Question 3

ICS - Image Clearing System
What is it ?

Answer 3

launched in 2019, fundamentally transforming cheque and credit processing by enabling digital images of cheques (and bank giros) to be exchanged between banks and building societies across the UK for clearing and settlement