Managing UK payments efficiently is a vital part of modern treasury and finance operations.
Whether you're an SME or an enterprise-level finance leader, understanding the available payment method, and when to use them, can significantly impact your cash flow, supplier relationships, and overall operational efficiency.
Let’s break it down with a practical overview of the three main UK payment systems: Faster Payments, BACS, and CHAPS.
UK Payment Methods Explained
Faster Payments
Faster Payments are near-instant electronic transfers, typically settling within seconds or minutes. This method is ideal for urgent payments, such as settling time-sensitive supplier invoices or transferring funds internally across business units.
BACS (Bankers' Automated Clearing Services)
BACS payments usually take three working days to clear. They're most effective for scheduled, non-urgent transactions like payroll, vendor payments, and standing intercompany settlements. BACS is widely used due to its reliability and lower cost per transaction.
CHAPS (Clearing House Automated Payment System)
CHAPS is designed for high-value, same-day payments and is commonly used by large enterprises for critical, time-sensitive transfers—such as settling real estate transactions or making large corporate payments before end-of-day cutoffs.
Note: The Image Clearing System (ICS) is used for processing cheque paymentsin the UK and is not a direct method for making electronic payments like those listed above.
How Fennech Supports These Payment Types
Agency Management Made Simple
Managing payables and receivables across a network of agencies, suppliers, or internal entities can become overwhelming, especially with tight timelines and complex fundingflows. Fennech’s treasury platform helps you automate and track these transactions, ensuring control and visibility.
Use Faster Payments for urgent supplier invoices to avoid delays in your supply chain.
Use BACS for predictable, recurring payments to affiliate companies, improving consistency and reducing administrative overhead.
Use CHAPS when high-value, time-critical transfers are required with same-day assurance.
Advanced Reconciliation Manager
Fennech’s Advanced Reconciliation Manager automatically matches incoming and outgoing transactions across all payment types. It links your bank feeds with internal ledgers, saving time, reducing manual work, and improving accuracy.
Whether payments come through Faster Payments, BACS, or CHAPS, the reconciliation engine ensures every transaction is correctly allocated, providing your finance team with up-to-date, reliable data.
Cutting Operational Costs
By automating manual processes and using the right payment method for each use case, your organisation can significantly reduce overhead.
Faster Payments reduce the need for manual follow-ups and delayed invoice resolution.
BACS minimises transaction fees for recurring bulk payments.
Automation tools like Fennech’s reconciliation and payment workflows eliminate hours of administrative work.
In Summary
Understanding how to effectively manage UK payments is critical for any finance or treasury function. By using the right mixof Faster Payments, BACS, and CHAPS, organisations can improve cash flow control, enhance supplier relationships, and reduce operational costs.
Whether you're looking to automate reconciliation, simplify agency payments, or enable faster, more accurate fund transfers, Fennech’s platform is built to support your treasury operations from end to end and whichever way you wish to orchestrate your payments.
💬 Ready to streamline your UK payments?
Get in touch to see how Fennech can help modernise your treasury operationsand reduce complexity across your finance workflows.
