What are Bacs and Faster Payments?
Bacs and Faster Payments are the two main schemes for paying between UK bank accounts in sterling. Bacs processes Direct Credits, such as salaries and supplier runs, and Direct Debits on a three-working-day cycle. Faster Payments, launched in 2008, moves money in near real time, around the clock, for payments of up to £1 million.
Also calledBacs Direct CreditDirect DebitFaster Payment ServiceFPS
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- Bacs cycle
- Three working days
- Faster Payments limit
- Up to £1 million (scheme)
- Operator
- Pay.UK
How Bacs and Faster Payments work
Both schemes are run by Pay.UK. For Bacs, a business, or a bureau acting for it, submits a payment file: the file is input on day one, processed on day two and the money reaches the recipient on day three. Because the date is predictable, Bacs is used for payroll and planned supplier payment runs, and for collecting Direct Debits. In 2025 it handled 6.86 billion payments worth £6.05 trillion. Faster Payments settles individual payments within seconds or minutes, at any time, up to a scheme limit of £1 million, though each bank sets its own lower limits. Same-day high-value payments go through CHAPS, run by the Bank of England. Accounts payable and banking software either produce Bacs files to upload to the bank or send Faster Payments directly through bank APIs and open banking.
Common questions
How long does a Bacs payment take?+
Three working days: the file is submitted on day one, processed on day two and the money arrives on day three, as long as it is sent before the cut-off time.
When should a business use Faster Payments instead of Bacs?+
For one-off or urgent payments that need to arrive the same day, including at weekends. Bacs suits planned bulk payments, such as payroll and weekly supplier runs.
What is a Bacs service user number?+
The number a business gets from its bank, through a sponsor, to submit Bacs files or collect Direct Debits directly. Smaller businesses often use their bank's bulk payment service or a bureau instead.
Software that sends Bacs and Faster Payments
MimoSupplier payments and collections auto-reconciled into Xero.Profile →
TideBusiness banking with invoicing and bookkeeping built in.Profile →
ANNA MoneyUK AI accounting platform combining banking with automated bookkeeping.Profile →
PayhawkCards, expenses and multi-currency accounts for global teams.Profile →
TipaltiGlobal payables with supplier onboarding, tax and mass payouts.Profile →Part of Accountio’s accounting technology coverage · Glossary
