Payment by Direct Bank Transfer

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Bank Transfer in the UK

Also known as:

BACS payment
Bank Account Clearing System Payment
Wire Transfer
Direct Bank Transfer
BT
IBAN payment
(Bank Deposit) – see note on bank deposits below

What is it?

An electronic payment direct to or from your trading partner’s bank account. The payment is funded by cleared funds in a bank account (in other words a bank-to-bank transfer/payment).

You can also pay cash or cheque over the counter at your own bank.

You can also pay cash or cheque or at any branch of the seller’s bank (this may attract a fee – so check first). This is termed a ‘Bank Deposit’ by eBay.

Is it Safe?

Yes - the process of making a bank transfer is safe and secure. BUT there is no Buyer Protection on eBay for this method of payment, so that does not mean that the purchase is guaranteed to be 'safe'.

The eBay Standard Purchase Protection Program no longer exists. As a buyer, you will be relying on the seller to put things right if the transaction goes wrong. If they don't, your only recourse will be to :

  • Report the matter to the Police as Fraud by obtaining money by deception
  • Take the seller to the Small Claims Court (will cost you ~£30 to start proceedings)
but there will be no guarantee of getting the item or a refund.

The only way to obtain Buyer Protection is by paying with PayPal. But please don't forget that low-value transactions do not need Buyer Protection. Bank Transfer purchases from sellers with an impeccable selling record can be considered (but thoroughly research their feedback, including the comments and any withdrawn ratings). Do you want to pay a premium for PayPal (as sellers will pass on the receiving PayPal fee to you) for protection that you might not need?

When you send someone a personal cheque/check, that has your bank account number, sort code and a copy of your signature. Have you ever been defrauded by sending a cheque?

When you give someone your bank account number and sort code, there are only two things that someone can do with them:

  • a. Make a payment to your account. They cannot access your account directly to remove funds unless you also give them your internet banking password, security details etc – and why would you want to do that?
  • b. Set up a Direct Debit. You are protected by the Direct Debit Guarantee against unauthorised Direct Debits. In the very unlikely event of this happening, inform your bank and they will return the funds and recover them from the fraudulent party. They will also pass on the fraudster’s receiving bank details to the relevant Law Enforcement Agency.
When programs like the News and Watchdog refer to ‘Bank Details’ they are not referring to the account number and sort code, but ALL the details necessary to access funds in your account. They have a propensity to scaremonger.

What do I Need?

As a seller – To make your Name, Bank Account Number and Sort Code available to your buyer (IBAN, BIC/SWIFT and possibly your bank's and your postal address for international payments).

Your IBAN and BIC numbers can be found on your bank statement, either/or paper/electronic statement. If you can't find them, ring your bank and ask them to tell you them.

As a domestic buyer – your seller’s full Account Name, Account Number and Sort Code

As an international buyer – additionally, IBAN and BIC, bank name and possibly bank address

Access to telephone or internet banking.

How Long Does it Take?

Domestic transfer
– between accounts of the same bank: instantaneous, or near instantaneous.
- between accounts who's both banks are members of the Faster Payments Service (FPS): hours
– between accounts of different banks who's banks are not both members of the FPS: up to 3 working days.

International transfer
- Variable: check with your bank for incoming payments, but likely 3-5 working days.

More information on FPS here:

http://www.ukpayments.org.uk/faster_payments_service/
http://www.ukpayments.org.uk/faster_payments_service/background/

Banks currently receiving Faster Payments include: Alliance & Leicester, Barclays Bank, Citi, Clydesdale and Yorkshire Banks, Co-operative, HBOS, HSBC, LloydsTSB, Nationwide, Northern Bank, Northern Rock, RBOS Group (incl Natwest and Ulster Bank).

Check to see if a bank account can send/accept a FPS payment here:

http://www.ukpayments.org.uk/sort_code_checker/

How Much Does it Cost?

The below statements apply to a Personal bank account. There may be fees involved with bank transfers to/from a Business bank account – check with your Business Manager.

UK domestic transfers – FREE for both buyer and seller

Receipt of Euro Zone to UK international transfer – A few pennies on the exchange spread of currency conversion from €Euro to £GBP, as long as buyer selects ‘shared charges’ (default option) and pays in €Euros.

Sending a Euro Zone to UK international transfer – Probably free, but check with your Bank, as long as buyer selects ‘shared charges’ (default option) and pays in €Euros.

Receipt of Non-Euro Zone International transfer – Variable. Check with your bank. Ask for the International Transactions Department.

Payment of non-£GBP international transfer – Variable. Check with your bank. It is likely it will cost at least £10-£20+ through the bank’s RELAY or SWIFT payment system. It may be possible to make an IBAN payment at a lesser cost – ask your bank. There is a third party payment service that can make the transfer for you, run by a well known, established eBayer, at a cost almost certainly cheaper than your bank. The new links policy means I can't put the link here, but if you would like details, please contact me ( clickable email link on my me page - and note sometimes eBay block messages through their message system).

Due to EU regulation, EU and EEA countries are not allowed to charge more for a cross-border payment made in €Euros with ‘shared charges’ selected than they are for a domestic transfer.

UK banks are allowed to charge conversion fees from €Euro to £GBP

Some UK banks will attempt to charge you ~£1 for a ‘letter of advice’ on receipt of a cross-border payment (Natwest and RBOS at least). If that happens, tell your bank you do not want a letter of advice, otherwise you will close your account and move it to another bank.

** Updated Apr-2010 **

AJ
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