Faster Payments enablement guide - NatWest
Faster Payments enablement guide - NatWest
Faster Payments enablement guide - NatWest
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<strong>Faster</strong> <strong>Payments</strong> <strong>enablement</strong> <strong>guide</strong><br />
<strong>NatWest</strong> Collection Account (HOCA)
<strong>Faster</strong> <strong>Payments</strong> – Mandatory reach to be<br />
completed by the end of 2011<br />
Background<br />
From 1 January 2012, the UK’s Payment Services Regulations require all qualifying payments between payment<br />
service providers to arrive the next working day. To achieve compliance all sort codes which can receive Bacs<br />
credits must be able to receive <strong>Faster</strong> <strong>Payments</strong> by the end of 2011.<br />
The CHAPS Company, which operates the <strong>Faster</strong> <strong>Payments</strong> service, has mandated this with the backing of the<br />
FSA and Bank of England. Progress will be monitored across the industry. <strong>NatWest</strong> is also reviewing its <strong>Faster</strong><br />
Payment limits to ensure that non-compliant payments can be sent as <strong>Faster</strong> <strong>Payments</strong>.<br />
What you need to do<br />
As a HOCA customer you have been identified as having a sort code (or sort codes) set up to receive Bacs credits<br />
which is on the Industry list of sort codes which must become <strong>Faster</strong> <strong>Payments</strong> enabled before the end of<br />
December 2011.<br />
The <strong>Faster</strong> <strong>Payments</strong> service was launched in May 2008 and allows both consumers and businesses the ability to<br />
make UK domestic credit payments in near real-time via Internet and Telephone banking services at any time, any<br />
day of the year.<br />
Decisions<br />
This <strong>Faster</strong> <strong>Payments</strong> <strong>enablement</strong> <strong>guide</strong> contains all the information you need to help you decide when to receive<br />
your Datalink* files.<br />
When you have considered the changes required to your internal systems and processes, you will need to complete<br />
and return the enclosed “Additional services/Amendment Form”.<br />
Next steps<br />
If you have any further questions not covered by this <strong>guide</strong>, please email: FPSwitchon@natwest.com<br />
*Datalink will in the future be known as Bankline Direct due to the migration of Datalink services<br />
onto Bankline Direct channels, but for the purpose of this document we will refer to it under the<br />
generic name Datalink.<br />
2
Receiving <strong>Faster</strong> <strong>Payments</strong><br />
Existing payments into your HOCA<br />
<strong>Payments</strong> that you currently receive into your HOCA sort code (i.e. Bacs Credits* and/or Bank Giro Credits)<br />
will continue without disruption. You will however, notice a reduction in the number of Bacs Credits as these<br />
become <strong>Faster</strong> Payment credits.<br />
Statement narrative (please refer to Page 4).<br />
At the end of each business day you will see a new settlement entry on your account.<br />
Funds availability (please refer to Page 4).<br />
Funds received as <strong>Faster</strong> <strong>Payments</strong> arrive on an intra-day basis and will be available for use as soon as they<br />
are applied to your Business Current Account.<br />
The value of these payments will be added to the accumulating balance of your HOCA which will be viewable<br />
via Bankline, our Internet banking service. You will also see the number of payments received.<br />
Data files<br />
As payments may be received intra-day and will contain more sender information, we will provide you with<br />
the opportunity to update both the data format and the time you receive your data.<br />
You will if you choose still be to receive data in the same format as now with minimal change. Please refer to<br />
the “<strong>Faster</strong> <strong>Payments</strong> Collection Account Options” pages.<br />
The <strong>Faster</strong> Payment in your files will have new transaction codes (please refer to Page 6).<br />
*This will mean Bacs Credit payments sent using Bacstel IP or Bacs Bureau.<br />
3
Statement Changes<br />
A new bulk credit will be posted to your settlement account from the date your sort code is enabled.<br />
The narrative of this bulk entry will be shown as: FP SETLMT xxxxxx (your sort code).<br />
Funds availability<br />
Bankline will show the accumulating number and value of <strong>Faster</strong> <strong>Payments</strong> into your HOCA as shown below:<br />
At the daily working day account cut off at 18.30 cut, the balance visible on the Bankline screen will be frozen<br />
at the total amount received until the account entry is posted.<br />
<strong>Payments</strong> after 18.30 will start to accumulate separately as part of next day’s balance but will only be visible<br />
after the prior day’s entry is posted to your account.<br />
4
<strong>Faster</strong> <strong>Payments</strong> options<br />
As a result of enabling your sort code for <strong>Faster</strong> <strong>Payments</strong>, there will be some changes to your data files and<br />
settlement transactions for the Datalink CAS service. The changes will depend on which option you select to<br />
receive the <strong>Faster</strong> <strong>Payments</strong> information.<br />
The options and changes are summarised below and each option is expanded in the following pages.<br />
Option 1: A merged CAS file<br />
You may find this easier as it does not require you to receive an additional file. <strong>Faster</strong> <strong>Payments</strong> transactions<br />
would be stored at <strong>NatWest</strong> as they are received, then merged into your existing CAS file so that you have one<br />
file to process in the same way that you do today. You will receive the benefit of the funds in near real-time,<br />
and if you process your CAS file overnight, your customer accounts/records will be updated earlier.<br />
Option 2: Separate <strong>Faster</strong> <strong>Payments</strong> file(s)<br />
<strong>Faster</strong> <strong>Payments</strong> received at <strong>NatWest</strong> will be batched periodically during the day and made available to you<br />
in <strong>Faster</strong> <strong>Payments</strong> files throughout the day. You have the option to receive between one and five files at<br />
various times.<br />
You can receive the information in the same file layout as your CAS file or a new ISO8583 format is also available.<br />
This option is likely to present the most changes to your processes. The benefit is having the ability to receive files<br />
intra-day in order to update your customer accounts/records in the earliest possible timescales.<br />
We have provided some more information in Appendix B and a full file format is included in your pack.<br />
5
Option 1 – Merged CAS file<br />
Impact<br />
With this option, <strong>Faster</strong> <strong>Payments</strong> will be included within your existing CAS file. Impacts and changes required are<br />
detailed in the previous slide but details specific to the merged CAS file are detailed below:<br />
<br />
<br />
<br />
<br />
Your sort code will be enabled on the Industry Sort Code Directory (ISCD)<br />
The file you receive will now also contain the following types of <strong>Faster</strong> Payment with new transaction codes:<br />
Code 68 – <strong>Faster</strong> Payment Incoming Credits<br />
Code 69 – <strong>Faster</strong> Payment Return Credits<br />
Code 40 – <strong>Faster</strong> <strong>Payments</strong> Reversal Debits (see Appendix A )<br />
The file availability time will now be 19:30 and this may be later than you currently receive your CAS file<br />
If you receive a merged CAS file, you can decide at any time to migrate to a separate <strong>Faster</strong> <strong>Payments</strong><br />
file. Parallel running (receiving both files concurrently) will be available on request for one month to assist<br />
your testing and transition.<br />
Changes Required<br />
A new bulk credit will be posted to your settlement account each day for <strong>Faster</strong> <strong>Payments</strong>. Since the <strong>Faster</strong> <strong>Payments</strong><br />
value date is the same day, your CAS file will reconcile against settlement transactions over two business days:<br />
<strong>Faster</strong> <strong>Payments</strong> settlement – same day as the file is made available<br />
Bacs Credits settlement transaction – business day after the file is made available<br />
Credit Clearing settlement transaction – business day after the file is made available.<br />
File Frequency: Weekly, Fortnightly or Monthly Reports<br />
As <strong>Faster</strong> <strong>Payments</strong> may be received at anytime during the day, you will be required to take a daily file for <strong>Faster</strong><br />
<strong>Payments</strong>. If you currently take your file less frequently than once a day, you can continue to do so for Bacs and<br />
Credit Clearing.<br />
Although we will generate a <strong>Faster</strong> <strong>Payments</strong> file every day, you will still have the option of collecting several files<br />
at once at your regular scheduled frequency instead of picking them up each day. You should bear in mind your<br />
customer proposition once real-time fund transfers become established.<br />
File name<br />
A new file name will be created for the merged CAS file and your internal systems will need to be updated to<br />
recognise this.<br />
File availability time<br />
If you currently download your CAS file before 19:30, you will need to change your scheduling to retrieve the<br />
file after 19:30. If you process files on an overnight batch basis, you should check the timing of this process.<br />
6<br />
Reversals<br />
Reversal transactions may be received. These will be included in your CAS file with a transaction code of 40.
Option 2 – Separate <strong>Faster</strong> <strong>Payments</strong> file(s)<br />
File collection: Daily Reports<br />
As <strong>Faster</strong> <strong>Payments</strong> may be received any time during the day, we will make files available more frequently than<br />
once a day, to ensure customers who need regular information have this when required. To ensure you can<br />
reconcile all payments received into your Collection Account sort code, the bulk credit cut-off time will be 18.30<br />
daily and the bulk credit will be posted overnight to your settlement account. To assist your reconciliation, you<br />
will be required to take a mandatory file after 18.30 each day.<br />
You will have the option of selecting up to five files per day at the following times:<br />
File cut off time<br />
Latest time file available<br />
Optional or<br />
Mandatory file<br />
Types of payments received<br />
07.00 08.00 Optional Standing Orders >90% of total<br />
Forward Dated payments and SIPs<br />
12.00 13.00 Optional Standing Orders, Forward Dated<br />
payments and SIPs<br />
15.30 16.30 Optional Standing Orders, Forward Dated<br />
payments and SIPs<br />
18.30 19.30 Mandatory All <strong>Faster</strong> <strong>Payments</strong> received intra day<br />
or the balance if taking other files<br />
throughout the day<br />
22.00 23.00 Optional SIPs received since 18.30<br />
Impact<br />
A separate file may assist your reconciliation as all transactions in the file will be <strong>Faster</strong> <strong>Payments</strong>, and therefore<br />
kept separate from other payment types in your existing CAS file. The value date for the <strong>Faster</strong> <strong>Payments</strong> file will<br />
be the same date as the file is received. Your existing CAS file is provided on Day 2 of the 3-day clearing cycle.<br />
By taking separate <strong>Faster</strong> <strong>Payments</strong> files, you can use these to update your customer accounts/records on the<br />
same day they are received.<br />
Changes Required<br />
File name<br />
New file names will be created for <strong>Faster</strong> <strong>Payments</strong> files incorporating the file cut-off time. Your internal systems<br />
will need to be updated to recognise the new file names.<br />
File collection time<br />
Files will now need to be collected at the selected times, including the mandatory file after 18:30. Your existing<br />
CAS file will be available at the usual time.<br />
Reversals<br />
Reversal transactions may be received. These will be included in your file.<br />
7
HOCA & Datalink Charges<br />
Collection Account charges<br />
There will be no change to how we charge you for <strong>Faster</strong> <strong>Payments</strong> transactions into your Collection Account.<br />
Transaction volumes will be captured in the same way as Bacs receipts and charged in line with agreed<br />
arrangements.<br />
Datalink/CAS file charges<br />
If you decide to enable your sorting code and have <strong>Faster</strong> <strong>Payments</strong> included in your existing daily CAS file, there<br />
will be no change to existing charging arrangements.<br />
If you opt for separate <strong>Faster</strong> <strong>Payments</strong> files (between one and five per day) then there will be an additional<br />
monthly fee for the <strong>Faster</strong> <strong>Payments</strong> file(s). This charge will be based on the number of files per day, plus a per<br />
item tariff.<br />
Charges are as follows:<br />
One file per day: £200 per month.<br />
Additional daily files: £100 per month.<br />
Maximum fee element: £500 per month.<br />
If you currently receive a periodic CAS file (e.g. weekly or monthly) and you wish to receive <strong>Faster</strong> <strong>Payments</strong><br />
included in this file, the file frequency will require to be changed to daily. This will result in an increase to the<br />
monthly fee that you pay for the service, and this will be agreed with you on migrating to the daily service.<br />
There will be no change to the transactional charges for items reported in Datalink files.<br />
8
Appendix A: <strong>Faster</strong> Payment Reversals<br />
Payment Reversals<br />
These transactions will only happen when there is a delay in the processing links between the receiving bank and<br />
the Central Infrastructure. If a receiving bank has not responded to the incoming payment within the agreed SLA,<br />
the Central Infrastructure will reverse the payment. Please see the diagram below for more information.<br />
To help you identify and reconcile these new types of transactions, we have introduced new transaction codes.<br />
Reversal transactions will be debits to your Collection Account sorting code. Currently Collection Account sorting<br />
codes only receive credit transactions. When you are enabled for <strong>Faster</strong> <strong>Payments</strong> you will also need to change<br />
your procedures to handle the new debit transactions in your Datalink file.<br />
You may wish to check your settlement account via Bankline or your statement to ensure that you identify any<br />
reversals. You will need to apply these to your own customer’s accounts.<br />
The incidence of reversals should be very rare and to reduce them further, <strong>NatWest</strong> will match reversal debits<br />
against the corresponding credit wherever possible without delaying your Datalink file. You should, however, make<br />
allowance for the possibility of reversal debits being reported in your file.<br />
Sending Bank<br />
1. Payment out<br />
2. Payment in<br />
Receiving Bank<br />
Central<br />
Infrastructure<br />
3. Timeout<br />
no response<br />
5. Rejection<br />
4. Payment reversal<br />
9
Appendix B: <strong>Faster</strong> <strong>Payments</strong> ISO8583 Format<br />
ISO8583<br />
If you opt to receive a separate <strong>Faster</strong> <strong>Payments</strong> file, you can receive this in the same format as your existing<br />
CAS file, or, you can receive the information in ISO8583 format. This is the industry format used by the member<br />
banks to pass payment data to and from the Central Infrastructure.<br />
It provides a greater level of detail than your normal CAS file format.<br />
If you initially opt for CAS format, you can migrate to ISO8583 format at any time, and parallel running will<br />
be available.<br />
The list below is a sample of some of the additional information available in the ISO8583 format compared<br />
to CAS. A full file specification document is included in the pack.<br />
Additional Information provided in ISO8583 (field length)<br />
Transaction Reference (18)<br />
Beneficiary Customer Account (34)<br />
Originating Credit Institution (11)<br />
Originating Customer Account (34)<br />
Charging Information (204)<br />
E2E Ref (31)<br />
File I.D. (32)<br />
Beneficiary Credit Institution (11)<br />
Originating Customer Account Name (40)<br />
Originating Customer Account Address (140)<br />
Beneficiary Customer Account Name (40)<br />
Beneficiary Customer Account Address (140)<br />
Remittance Information (140)<br />
Payment Return Code (8)<br />
Returned Payment - <strong>Faster</strong> <strong>Payments</strong> I.D. (42)<br />
National Westminster Bank Plc. Registered in England No 929027. Registered Office: 135 Bishopsgate, London EC2M 3UR. 90079501