Source: https://rivet.global/blog/chaps-vs-bacs-vs-faster-payments
Published: 2026-07-15 · Updated: 2026-07-15 · By Rashidatou K.

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

The three UK payment systems compared: speed, cost, limits and hours, and which one to use for payroll, supplier payments and large one-off payments.

## Key takeaways

- Faster Payments: seconds, 24/7, up to £1 million per payment, usually free.
- Bacs: a three-working-day cycle, used for payroll, supplier batches and Direct Debit.
- CHAPS: same working day, no scheme maximum, settled at the Bank of England, usually £20 to £35 at a bank.
- A Bacs payment submitted on Monday arrives on Wednesday; bank holidays and weekends add days.
- Pick the rail by deadline and size, not habit.

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](/blog/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.

1. 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.
2. 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](/blog/confirmation-of-payee-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](/blog/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](/payouts) with each recipient's rail and fee shown before you approve.

## Questions

### 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.