Can a bank stop a Bacs payment

[STEVENM]

If a bacs payment is made but there are not adequate funds on the day of payment(assuming there were funds prior to the payment due date) can the bank stop that payment, as they could with a cheque.If so what is the latest the bank could stop the payment?

[khana]

Yes, they can recall the BACS payment as it really just an automated Bank Giro Credit.

As to the latest they can stop it, as I understand it they can recall the money at any time as long as it has not hit the recipients Bank account , so I guess your talking up to 2 working days as it should go in on the third.

[khana]

PS Yes, I know you can do same day BACS payments as well, but they are very rarely done for the majority of people.

[Loosehead]

To answer this question you should imagine your account as a biscuit tin. At the time payment is made the bank will go to your "Biscuit tin" for the money, if there are not sufficient funds there, the bank has a choice, it can loan you the money from other custmers tins but taking responsibility of the money's replacement or it can refuse to make the payment on the basis of insufficient funds. Your use of the phrase "Can the bank...." implies that you may think that it is perhaps not the banks choice, it is entirely there choice not to lend you money, they may well lend you money but that will depend on your standing with them and arrangements made, ie arranged overdraft for example. The contents of your tin at some time prior to the payement are irrelevant.

[PFA]

My two pence worth....... YES they can recall it upto the close of business day AFTER the money has hit the account or on the request of the credting party (same business day prior to cut off time).