Decoding the Digits: Exploring the Numbers Behind the UK's Payment Rails

Issue 580: 1 March 2024

Decoding the Digits: Exploring the Numbers Behind the UK's Payment Rails

In this first round up for retail payments in 2024, for the month of January 2024, we continue to see double digit growth in the volume and value of Faster Payments and double digit decline in Cheques.

The value of Direct Debits processed increased by 6% over the same period again perhaps continuing to reflect an increase in costs of the goods and services that we consume.

The growth in volume and value for the UK’s bulk clearing scheme were 1% and 5% respectively with growth in the volume and value for the UK’s real time gross settlement system now unchanged and a decrease of 8% respectively.

Note: All data is publicly sourced and is the latest available: Pay.UK January 2024.

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Faster Payments

In the 12 months to the end of January 2024:

• Single Immediate Payment volumes have increased by 19% (12 months to December 19%)

• Total Faster Payment volumes have increased by 14% (12 months to December 14%)

• Single Immediate Payment values have increased by 17% (12 months to December 18%)

• Total Faster Payment values have increased by 14% (12 months to December 15%)

Faster Payments volumes continue to be bolstered by the continued switch from analogue to digital payments and also by the growing importance of Open Banking initiated Account to Account (A2A) payments.

Continued growth in Faster Payments is expected from Open Banking A2A payments and payments initiated by overlay services such as Variable Recurring Payments (VRPs).

In time, the growth is also likely to be further bolstered through the introduction of new Faster Payment types (or flavours) as part of version 1.0 of the planned New Payments Architecture (NPA) and, perhaps, through a future planned migration of Bacs Direct Credit payments into the NPA.

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Bacs Direct Debit and Direct Credit

In the 12 months to the end of January 2024:

• Bacs Direct Credit volumes have decreased by 2% (12 months to December decreased by 1%)

• Bacs Direct Debit volumes have increased by 2% (12 months to December increased by 2%)

• Total Bacs volumes have increased by 1% (12 months to December increased by 1%)

• Bacs Direct Credit values have increased by 5% (12 months to December increased by 5%)

• Bacs Direct Debit values have increased by 6% (12 months to December increased by 7%)

• Total Bacs values have increased by 5% (12 months to December increased by 6%)

Bacs Direct Credit volumes seem to have stagnated at just under 2 billion transactions per annum with volumes for the 12 months to January 2024 decreasing by 2%.