New faster banking – but with a charge for Northern Bank

Northern Bank customers are set to have to pay £5 to take advantage of the new Faster Payments service (FPS) launched today.

While customers of seven major banks – including Barclays, HSBC, Lloyds TSB, and Royal Bank of Scotland – will be able to send and receive phone and internet payments in minutes, those at Northern Bank will have to pay £5 for the privilege.

Also Northern Bank customers will only be able to make such real time payments – where cash is transferred in minutes and at most over three hours – in branches and requests made after 15:30 will be dealt with the next day.

The new payments system from Apacs was supposed to close the banking black hole – where customers' cash disappeared for three days when being transferred – but those at Northern Bank are set to keep on with long transfer waits.

The Faster Payments system is being gradually introduced from today across 13 banks and building societies covering 95 per cent of banking customers.

From 7:00 BST, 898 payments were made to a value of £461,383.43 – an average of around £513, a surprisingly large sum.

A Northern Bank spokesperson said: "Later in the year we will introduce in phases the ability to send FPS payments via self service channels such as 24 Hour Telephone Banking, Northern eBanking and Northern Business eBanking.

"There will be no charges for receiving payments, for Standing Order payments or for sending FPS payments via self service channels."

The FPS has initially been limited to low value payments, but this is expected to rise swiftly as the system develops.