Bank Transfer’s: How Long Does a BACS Payment Take?

If you want to transfer money either to friend or to pay for something, you have a few choices on going about it. In this article, we’re looking specifically at Bacs payments, what they are, how much it costs to make a transfer and how long does it take to make it.

If you just want to know how long does a BACS payment take? It takes three working days or less. In the UK, if you want to transfer money, you typically have three choices Bacs, Chaps and Faster Payments.


Bacs stands for ‘Bankers Automated Clearing Services‘ and is a membership program in the UK consisting of 16 leading banks. In the UK each year, 4.4 billion payments are made through this platform with a total value over 1.5 Trillion. Generally, there two ways to make a Bacs Payment, direct debit or Bank transfer;

  • Direct Debit is usually used as a simple way to make payments where same-day payment isn’t required. Direct debit is both safe allowing customers to be protected from fraudulent payments, easy to set up and great for recurring payments.
  • Bank Transfer (Bacs Direct Credit) allows you to transfer money from one account to another quickly and safely. Currently, there are about 2 billion Bank Transfer payments made each year mostly for the workforce in the UK to get paid monthly with their salaries. Generally, a Bacs transfer takes three working days to clear, with strict cut-off times for processing payments, so it is not suitable for immediate and same-day payments.

How Do You Transfer Money Using Bacs?

Bacs payments are straightforward, which is the key advantage of the system, however, given there are two types of bacs transfers, there are two ways to make this payment. For a;

  • Bank Transfer (Bacs Credit) – your bank will allow you to transfer money to another account using your personal or business account. You need the name of the account, the name of the bank, the sort code and the account number. This type of transfer will cost between 5p and 50p, plus any additional fees your bank may charge.
  • Direct Debit – With this type of transfer you’re authorizing your bank to take payment from their account which can be set up using a direct access via a bank, a bacs approved bureau or a third-party provider.

Faster Services

Both a Bank Transfer and a Direct Debit work on a three-day cycle to clear into your account. If you want a faster service, you have two choices in the UK today, Faster Payment Service and CHAPS

  • Faster Payments – was introduced to the UK in 2008 and provided near real-time (approx. two hours to clear) the transfer of money between accounts that can be made online, over the phone or in your local branch. There is a max of 250,000 per transfer
  • CHAPS “Clearing House Automated Payment System” – offers UK bank-to-bank Pound fund transfers that CHAPS system guarantees same-day clearance so long as instructions are received by 2pm on a working day. The key advantage over CHAPS as oppose to Faster Payments above, CHAPS has no limit to the amount of money your can send, although given it’s an expensive service costing between £25 and £30 per transfer, it’s usually reserved for large transfers.

Final Thoughts

What type of payment should you use? Personally, I use Direct Debit for 90% of all my transactions as it’s a simple, cost-effective way to make recurring and one-off payments where same-day money clearance is not required.

For everything else, a simple BACS bank transfer is the best way to transfer money. I don’t have to worry about the speed of clearance and as such do not need to use CHAPS clearance. is written by David Jacobs who is on a quest to retire early and get out of the rat race. David is a financial expert who lives for early retirement. Follow his journey making money, saving and investing to retire early and get the best out of his retirement.

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