If you’ve recently moved to the UK, chances are you’ve already used a Bacs transfer; you just might not have realised it. It’s the system behind most salary payments, rent transfers, and household bills, quietly keeping day-to-day life running smoothly.
At Remitly, we know that understanding how money moves in a new country can take some getting used to, especially when every country does it differently. So, we’ve put together this guide to explain what Bacs transfers are, how they work, and why they’re still such a trusted part of the UK banking system.
What is a Bacs transfer?
A Bacs transfer, short for Bankers’ Automated Clearing System, is one of the UK’s oldest and most trusted ways to send money from one bank account to another. It’s been part of the UK’s financial system for over 50 years.
If you get paid by your employer, receive benefits, or pay your electricity bill automatically, that’s Bacs in action. It’s a behind-the-scenes system that connects UK banks so money moves safely and smoothly without anyone needing to lift a finger. Think of it as a digital motorway for money: it doesn’t rush, but it’s steady, organised, and incredibly dependable.
The two types of Bacs transfers
There are two main types of Bacs transfers: Bacs Direct Credit and Direct Debit. One sends money out, and the other collects it in.
Bacs Direct Credit (sending money)
When you receive your monthly salary, that’s usually a Bacs Direct Credit. It’s the system employers, government departments, and businesses use to pay money into people’s bank accounts.
It’s a simple, low-cost way to handle regular outgoing payments like wages, pensions, or supplier invoices. For most of us, it’s completely invisible; you just see the money land in your account like clockwork every month. It’s one of those processes you never have to think about, but you’d definitely notice if it stopped working.
Direct Debit (collecting money)
If you’ve ever set up automatic payments for your gym membership, council tax, or internet bill, you’ve already used a Direct Debit. Instead of you sending the money yourself, the company you owe collects the agreed amount from your account on a set date.
It might sound a little nerve-wracking to let someone take money from your account, but in the UK, it’s extremely secure. Every Direct Debit is protected by the Direct Debit Guarantee, meaning if a company ever takes the wrong amount, or takes it too early, you’ll get an immediate refund. That security, combined with the convenience of not having to remember due dates, is why most UK bills run on Direct Debit.
How does a Bacs transfer work?
A Bacs transfer follows a simple three-day process, often called the Bacs cycle. It’s not instant, but it’s reliable and predictable, making it ideal for regular payments.
- Day 1 is when the payment starts. The sender’s bank or employer uploads a payment file to the Bacs network, think of it as the “send” button being pressed.
- Day 2 is the processing stage. The Bacs system checks that everything’s correct, verifying account numbers and sort codes.
- Day 3 is when the money actually moves. The funds are deducted from the sender’s account and appear in the recipient’s account, ready to use.
Bacs only runs on working days, so weekends and bank holidays don’t count. If a payment is sent on a Friday, you’ll see it in your account on Tuesday. It’s not fast, but it’s steady.
How to get started with Bacs transfers in the UK
Bacs transfers are perfect for regular, scheduled payments: wages, bills, rent, or pensions. They’re steady, low-cost, and well-protected. To use Bacs, all you need is a UK bank account. It’s often one of the first things newcomers set up when they arrive, and it’s essential for things like getting paid or paying rent.
Opening an account has become much easier in recent years, with many high street and digital banks welcoming new arrivals. You’ll usually need a form of ID (like your passport or biometric residence permit) and proof of address. Once your account is ready, you can receive payments, set up Direct Debits, and start handling your finances.
What if a Bacs payment is delayed or fails?
Most Bacs payments arrive right on time, but if yours seems to be taking longer, it’s usually down to timing. Because Bacs only works on business days, payments made just before a weekend or a bank holiday can take an extra day or two.
Sometimes, though, it’s a simple error, like a wrong sort code or account number. It’s always worth double-checking the details you give your employer or landlord to avoid delays.
If a payment doesn’t arrive after three working days, contact your bank or the company that sent it. For Direct Debits, the Direct Debit Guarantee gives you full protection, so if money is ever taken in error, you’ll get it back right away.
Can you use Bacs to send money abroad?
Bacs transfers only work between UK bank accounts. If you try to use Bacs for an international payment, it won’t go through.
For transfers overseas, banks usually rely on SWIFT payments, which can take several days and may involve higher fees. That’s why many people prefer using services like Remitly for international money transfers. Remitly lets you send money abroad quickly and safely, with transparent exchange rates and delivery times you can track in real time.
What are the benefits of Bacs transfers?
Bacs might not make headlines, but it’s one of the quiet heroes of the UK banking system. From everyday bills to business payroll, it offers a blend of reliability, affordability, and security that’s hard to beat.
Cost-effective
Bacs transfers are among the most affordable payment options in the UK. Most personal users pay nothing at all, and for businesses, the cost per transaction is just a few pence. Compared to systems like CHAPS (Clearing House Automated Payment System), which can charge up to £30 per payment, Bacs is a budget-friendly way to handle regular payments.
That’s one reason so many UK companies use it for payroll. It keeps costs low while guaranteeing employees are paid reliably, every time.
Secure and reliable
Security is what makes Bacs so trusted. Managed by Pay.UK, the system is heavily encrypted and has been refined over decades. Every transaction is verified, tracked, and protected under strict UK regulations.
It’s not flashy or fast, but it’s built to last. For millions of people and businesses, Bacs is the engine that keeps everyday banking running safely in the background.
Efficient and automated
Bacs might not be the fastest system, but it’s wonderfully predictable. The three-day cycle means you always know when money will leave or arrive, making it easier to budget and plan ahead. For anyone managing finances across two countries or multiple accounts, that consistency is a real benefit.
That’s especially handy when you’re settling into life in a new country and juggling everything from setting up utilities to remembering rent day. Bacs handles the admin for you so you can focus on everything else.
Bacs vs other UK payment methods
Bacs isn’t the only way to send money within the UK, but it’s one of the most practical for regular, non-urgent payments. Here’s how it compares to other common systems:
| Payment Type | Speed | Typical Use | Cost | Best for |
| Bacs | 3 working days | Regular, non-urgent payments | Usually free or low-cost | Salaries, bills, rent |
| Faster Payments | Seconds to 2 hours | Online and mobile banking | Usually free | Urgent or one-off transfers |
| CHAPS | Same day (if before cut-off) | High-value transfers | Around £20–£30 | House deposits, large purchases |
If you need to pay someone urgently, Faster Payments is your best bet. If you’re buying a home or making a large same-day payment, CHAPS works better. But for steady, recurring transactions, Bacs is still the backbone of UK banking.
Making sense of money movement in the UK
Understanding Bacs transfers is one of those small but important steps toward feeling settled in the UK. Once you know how this system works, everyday tasks, like getting paid, paying bills, or managing rent, start to feel second nature.
It’s reassuring to know that the system handling most of your payments is built for reliability and protection. And while Bacs keeps things running smoothly at home, Remitly helps you stay connected to loved ones abroad, making international transfers simple, secure, and stress-free.
Whether you’re building your new life in the UK or supporting family overseas, knowing how your money moves means one less thing to worry about.
FAQs
How long does a Bacs transfer take?
Usually, three working days, one day for submission, one for processing, and one for clearing. Weekends and bank holidays aren’t counted.
Is a Bacs transfer free?
Yes, for most personal users. Businesses may pay a small fee depending on their bank setup.
What details are needed for a Bacs transfer?
You’ll need the recipient’s full name, sort code, and account number.
Can you cancel a Bacs transfer?
Only before it’s processed by your bank, typically before the end of the first day of the cycle.
Are Bacs transfers safe?
Absolutely. They’re encrypted, regulated, and covered by the Direct Debit Guarantee.