Have you ever wanted to know how to transfer money to someone else’s bank account? Thanks to digital banking, there are a number of different methods. This article tells you everything you need to know.
What information do I need?
Whatever method you choose, you will need the following information about the person or organisation you are paying:
- Name of the person or organisation
- Date of payment
- Six digit sort code from their account
- Eight digit account number from their account
- Payment reference to let them know where the money came from (such as your name)
- Name and address of the bank you are sending the money to. This is not always necessary but it can help.
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What different methods can I use?
When thinking about how to transfer money to someone else’s bank account, there are three basic methods you can use.
1. Online banking transfer
Thanks to internet banking this is becoming increasingly common. If you want to use this method, you will need to be registered with your bank’s online banking service.
Once you are registered, you can transfer the funds by accessing a website using your laptop. Some banks will also allow you to do this on your smartphone via an app.
2. Telephone banking transfer
This method involves calling the bank and asking them to complete the transfer for you over the telephone. The main disadvantage of this service is that you can only use it during specific hours.
Some banks offer an automated telephone service that you can access at any time of the day or night. You need to register beforehand if you want to use this service.
3. In-branch bank transfer
This method involves paying in the cash over the counter. In order to use this service, you have to visit the bank during its opening hours.
What different methods do the banks use?
There are two basic methods that the banks can use to transfer your money to someone else’s bank account.
1. CHAPS payments
This stands for Clearing House Automated Payment System. This type of payment method is used to transfer funds worth more than £10,000.
You are normally charged a fee per transaction from around £25 to £40 depending on the bank. The transfer of funds normally takes place within three hours.
2. Faster payments
This tends to be the method of choice for online banking, telephone banking and in-branch bank transfers.
This type of transaction is free and takes place within two hours. You can use the Faster Payments Service to make payments up to £250,000, but individual banks may choose to set their own limits.
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Take home
Many of the possible methods used to transfer money to someone else’s bank account require registration before you can use them. If you are interested, contact your bank and they will be able to help you register for online or telephone banking.
Registration will take time because your bank will need to send you passwords for verification. So if possible, it’s better not to wait until the last minute, because your options will be limited.
When transferring money, take your time. Double-check all of the details before making the transfer.
