The Payment Services Regulations 2017

Execution time and value date U.K.

Application of regulations 86 to 88 U.K.

85.—(1) Regulations 86 to 88 [F1 , except paragraphs (2A) to (2D) of regulation 86,] apply to any payment transaction—

[F2 (a) executed wholly within the qualifying area in euro under a payment scheme which operates across the qualifying area]

(b) executed wholly within the United Kingdom in sterling; or

(c) [F3 executed wholly under a payment scheme which operates across the qualifying area and] involving only one currency conversion between the euro and sterling, provided that—

(i) the currency conversion is carried out in the United Kingdom; and

(ii) in the case of cross-border payment transactions, the cross-border transfer takes place in euro.

[F4 (1A) Paragraphs (2A) to (2D) of regulation 86 (payment transactions to a payment account) apply to any payment transaction which is—

(a) authorised in accordance with regulation 67 (consent and withdrawal of consent);

(b) executed wholly within the United Kingdom in sterling; and

(c) not initiated by or through a payee.]

(2) In respect of any other payment transaction, the payment service user may agree with the payment service provider that regulations 86 to 88 (except regulation 86(3)) do not apply.

[F5 (3) In paragraph (1), “the qualifying area” means the area of the United Kingdom and the EEA States.]

Textual Amendments

F1 Words in reg. 85(1) inserted (30.10.2024) by The Payment Services (Amendment) Regulations 2024 (S.I. 2024/1013), regs. 1(2), 2(3)(a)

F2 Reg. 85(1)(a) substituted (31.12.2020) by The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 43(2)(a) (with reg. 4, Sch. 3 Pt. 2) (as amended by S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)

F3 Words in reg. 85(1)(c) inserted (31.12.2020) by The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 43(2)(b) (with reg. 4, Sch. 3 Pt. 2) (as amended by S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)

F4 Reg. 85(1A) inserted (30.10.2024) by The Payment Services (Amendment) Regulations 2024 (S.I. 2024/1013), regs. 1(2), 2(3)(b)

F5 Reg. 85(3) inserted (31.12.2020) by The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 43(3) (with reg. 4, Sch. 3 Pt. 2) (as amended by S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)

Payment transactions to a payment account U.K.

86.—(1) Subject to paragraphs (2) [F6 , (2A) to (2D)] and (3), the payer's payment service provider must ensure that the amount of the payment transaction is credited to the payee's payment service provider's account by the end of the business day following the time of receipt of the payment order.

(2) Where a payment transaction is initiated by way of a paper payment order the reference in paragraph (1) to the end of the business day following the time of receipt of the payment order is to be treated as a reference to the end of the second business day following the time of receipt of the payment order.

[F7 (2A) Paragraph (2B) applies where the following conditions are met—

(a) the payer’s payment service provider has established that there are reasonable grounds to suspect a payment order from a payer has been placed subsequent to fraud or dishonesty perpetrated by a person other than the payer; and

(b) such grounds are established by no later than the end of the business day following the time of receipt of the payment order.

(2B) Subject to paragraph (2C), the payer’s payment service provider may delay crediting the amount of the payment transaction to the account of the payee’s payment service provider for the purpose of contacting the payer or other relevant third party to make further enquiries in order to establish whether it should execute the payment order.

(2C) The delay referred to in paragraph (2B) must be no longer than necessary to achieve the purpose described, and in any event, no longer than the end of the fourth business day following the time of receipt of the payment order.

(2D) Where a payment service provider delays a payment order under paragraph (2B)—

(a) the payer’s payment service provider must notify the payer of—

(i) the fact of the delay;

(ii) the reasons for the delay; and

(iii) any information or action required of the payer to enable the payment service provider to decide whether to execute the order;

(b) the notification under sub-paragraph (a) must be given or made available in an agreed manner and as soon as possible, and in any event by no later than the end of the business day following the time of receipt of the payment order;

(c) the requirement in sub-paragraph (a) does not apply to the extent complying with it would be otherwise unlawful.]

(3) Where a payment transaction—

(a) does not fall within paragraphs (a) to (c) of regulation 85(1) [F8 or regulation 85(1A)]; but

(b) is to be executed wholly within the [F9 United Kingdom],

the payer's payment service provider must ensure that the amount of the payment transaction is credited to the payee's payment service provider's account by the end of the fourth business day following the time of receipt of the payment order.

(4) The payee's payment service provider must value date and credit the amount of the payment transaction to the payee's payment account following its receipt of the funds.

(5) The payee's payment service provider must transmit a payment order initiated by or through the payee to the payer's payment service provider within the time limits agreed between the payee and its payment service provider, enabling settlement in respect of a direct debit to occur on the agreed due date.

Textual Amendments

F6 Words in reg. 86(1) inserted (30.10.2024) by The Payment Services (Amendment) Regulations 2024 (S.I. 2024/1013), regs. 1(2), 2(4)(a)

F7 Reg. 86(2A)-(2D) inserted (30.10.2024) by The Payment Services (Amendment) Regulations 2024 (S.I. 2024/1013), regs. 1(2), 2(4)(b)

F8 Words in reg. 86(3)(a) inserted (30.10.2024) by The Payment Services (Amendment) Regulations 2024 (S.I. 2024/1013), regs. 1(2), 2(4)(c)

F9 Words in reg. 86(3)(b) substituted (31.12.2020) by The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 44 (with reg. 4, Sch. 3 Pt. 2) (as amended by S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)

Absence of payee's payment account with the payment service provider U.K.

87.—(1) Paragraph (2) applies where a payment service provider accepts funds on behalf of a payee who does not have a payment account with that payment service provider.

(2) The payment service provider must make the funds available to the payee immediately after the funds have been credited to that payment service provider's account.

Cash placed on a payment account U.K.

88.  Where a payment service user places cash on its payment account with a payment service provider in the same currency as that payment account, the payment service provider must—

(a) if the user is a consumer, micro-enterprise or charity, ensure that the amount is made available and value dated immediately after the receipt of the funds;

(b) in any other case, ensure that the amount is made available and value dated no later than the end of the next business day after the receipt of the funds.

Value date and availability of funds U.K.

89.—(1) The credit value date for the payee's payment account must be no later than the business day on which the amount of the payment transaction is credited to the account of the payee's payment service provider.

(2) Paragraph (3) applies where—

(a) the transaction does not involve a currency conversion [F10 by the payee’s payment service provider];

(b) the transaction involves [F11 a currency conversion by the payee’s payment service provider] between the euro and pounds sterling F12 ...; or

(c) the transaction involves only one payment service provider.

(3) The payee's payment service provider must ensure that the amount of the payment transaction is at the payee's disposal immediately after that amount has been credited to that payment service provider's account.

(4) The debit value date for the payer's payment account must be no earlier than the time at which the amount of the payment transaction is debited to that payment account.

Textual Amendments

F10 Words in reg. 89(2)(a) inserted (13.1.2018) by The Payment Systems and Services and Electronic Money (Miscellaneous Amendments) Regulations 2017 (S.I. 2017/1173), regs. 1(4), 7(g)(i)

F11 Words in reg. 89(2)(b) substituted (13.1.2018) by The Payment Systems and Services and Electronic Money (Miscellaneous Amendments) Regulations 2017 (S.I. 2017/1173), regs. 1(4), 7(g)(ii)

F12 Words in reg. 89(2)(b) omitted (31.12.2020) by virtue of The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 45 (with reg. 4, Sch. 3 Pt. 2) (as amended by S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)