CHAPS vs Bacs vs Faster Payments: which UK payment to use

Faster Payments arrives in seconds and runs 24/7, up to £1 million. Bacs takes three working days and suits payroll and Direct Debits. CHAPS settles large payments the same working day through the Bank of England, usually for a fee.

Rashidatou K.Payments editor

Published: 15 July 2026
Reading time: 2 min read

The UK has three main systems for moving pounds between accounts. They do the same job at different speeds, sizes and prices. Most businesses use all three without noticing which one their bank picked.

How do the three compare?

	Faster Payments	Bacs	CHAPS
Speed	Seconds, up to 2 hours	3 working days	Same working day
Hours	24/7, every day	Working days	Working days, bank cut-offs in the afternoon
Limit	£1 million per payment (scheme), bank limits lower	Set by the sponsoring bank	No scheme maximum
Typical cost to send	Free at most banks	Low, per item	£20 to £35 at many banks
Best for	Everyday payments, urgent supplier payments	Payroll, Direct Debit, large batches	Large or time-critical payments
Run by	Pay.UK	Pay.UK	Bank of England

When should you use Faster Payments?

For almost everything up to your bank's limit: supplier invoices, refunds, contractor payments and urgent transfers. Money usually arrives in seconds, including evenings and weekends. Our guide to the Faster Payments limit explains why your bank's cap is lower than the £1 million scheme limit.

When does Bacs make sense?

Bacs is older and slower, but it is the system behind payroll and Direct Debit.

Bacs Direct Credit pays salaries and supplier batches from a file. Payroll software produces the file, and staff are paid on the same day each month.
Direct Debit lets you collect from customers' accounts with their mandate, and is protected for the payer by the Direct Debit Guarantee.

The cycle is three working days. Submit on day one, process on day two, money arrives on day three. To pay staff on the 28th, the file has to go in two working days before.

When should you use CHAPS?

CHAPS settles each payment individually through the Bank of England's real-time gross settlement system. Once sent, it cannot be recalled by the sender. Use it when the payment is too large for Faster Payments or must be certain to land the same day: property completions, large supplier deposits, transfers between your own banks. Check your bank's cut-off; most stop accepting CHAPS instructions in mid or late afternoon.

Which rail checks the payee's name?

Confirmation of Payee runs on Faster Payments and CHAPS payments to new payees, and Bacs Direct Credit payees can be checked when you set them up. A close match or no match is worth acting on whichever rail you use.

What about international payments?

None of the three leaves the UK. GBP payments to accounts abroad go by SWIFT. Euro payments can go by SEPA, which UK payment providers can still use. See SWIFT vs SEPA vs ACH vs Faster Payments for the international side.

How Rivet sends GBP

On Rivet's Growth plan, registered companies get GBP account details in their own name. GBP payouts go by Faster Payments, and a batch of payments to UK recipients goes out from one file with each recipient's rail and fee shown before you approve.

Questions people ask

How long does a Bacs payment take?

Three working days. Day one the file is submitted, day two it is processed, day three the money arrives. Weekends and bank holidays do not count, so a file sent on Thursday arrives on Monday.

Is CHAPS the same as a wire transfer?

It is the UK's domestic same-day high-value payment, similar in role to a US Fedwire transfer. International payments go by SWIFT, which is different.

Why do banks charge for CHAPS but not Faster Payments?

CHAPS settles each payment individually in central bank money with no limit, which costs banks more to run and carries more risk controls. Faster Payments settles in net batches.

Which is best for paying salaries?

Bacs is the traditional choice because payroll software produces a Bacs file and the timing is predictable. Many businesses now use Faster Payments for payroll as well, especially for small teams.

Sources

Written by

Rashidatou K.

Payments editor

Rashidatou writes Rivet's guides to how money moves between countries: the payment rails, what each one costs, and the account details a company needs to get paid in another currency. Every figure in Rashidatou's articles is traced to the scheme rulebook, the regulator or the provider's published price list, and those sources are listed at the end.