Sunday, July 18, 2010

Payment by Direct Bank Transfer

Bank Transfer in the UK

Also known as:BACS payment
Bank Account Clearing System Payment
Wire Transfer
Direct Bank Transfer
IBAN payment
(Bank Deposit) see note on bank deposits below

What is it?An electronic payment direct to or from your
trading partners 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.

can also pay cash or cheque or at any branch of the sellers bank (this
may attract a fee so check first). This is termed a Bank Deposit by

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an impeccable selling record can be considered (but thoroughly research their feedback, including the comments and any withdrawn ratings).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
  • 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 fraudsters 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 sellers 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:

Banks currently receiving Faster Payments include: Alliance

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