New protection for people who make money transfer mistakes
A new rule means your bank or building society must try to reclaim your cash if you make a mistake on a transfer.
There's a new safety net now in place to make it far easier to get your money back if you mistakenly transfer it to the wrong bank account.
If you send a mistaken payment through Faster Payments or Bacs,and report it to your bank, they must now take action within two working days. If the recipient doesn’t dispute your claim, the cash will be returned within 20 working days.
Whatever the outcome, you'll be informed within 20 working days, though it's likely to be sooner. If there’s evidence of a mistake, the receiving bank will stop the money being spent by the wrong person.
That said, you aren't guaranteed to get your money back. To “balance the rights of all customers”, recipients are protected by their bank and given the chance to dispute the return.
No funds will be removed without the recipient’s consent in cases that are less clear cut.
It's important to remember that this doesn't change your legal rights. People who spend money that doesn’t belong to them are committing a crime and can be reported to the police.
These changes have been introduced by Faster Payments and Bacs, strengthening measures introduced in May 2014 to standardise the timescales customers can expect for a bank or building society to investigate a report of an incorrect payment.
Michael Chambers, chief executive of Bacs, said: “It is inevitable that human error can sometimes creep in when lengthy account details are being input, and it is absolutely right that anyone who is out of pocket as a result of a mistake can get that money back.”
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Protection for most payments
Faster Payments and Bacs make up 95% of digital and online transactions and are used by all major UK banks. The remaining 5% are from smaller agency banks who don’t process transactions themselves and won’t be covered by the new safety net until later in the year.
If your cash can’t be recovered, your bank will give you clear options on what you can do next, including going to court. Failing that you can follow your bank’s standard complaints procedure and if you’re still not satisfied, you can make a complaint to the Financial Ombudsman Service.
To save yourself a lot of hassle in the first place, make sure you check and double-check the account number and sort code of your intended recipient before you confirm payment.
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