Clearing House Automated Payments System

The Clearing House Automated Payments System (CHAPS) is a London based British company which was established in 1984. The main purpose of CHAPS is to facilitate trading done in European currencies.

CHAPS explained

The Clearing House Automated Payment (CHAPS) is a company that facilitates sterling transfers on the same day that the transaction is made. CHAPS is a process similar to bank wires as it allows the transfer of money from one bank account to another.

The CHAPS transfer is initiated by an individual sender who wishes to make monetary transfers into a recipient’s bank account. Due to the same-day funds transfer that CHAPS offers individuals, the monetary transaction eliminates issues of float time that is usually stipulated with paper cheques. Therefore the money is moved into the relevant account without delays; however there is usually a fee that needs to be complied with.

Statistically there are a total of 19 settlement banks and more than 400 sub-member financial institutions that actively offer CHAPS services including the Bank of England. There has been a substantial growth in CHAPS transfers, with an estimated 32 million transactions that totaled £61 trillion being conducted in 2010.

CHAPS is a frequently used service that is acquired by solicitors to make high-value payment to suppliers. In order to offer CHAPS services in your banking or financial institution, it is advised to seek the assistance of a professional consultancy firm. Through the advice and guidance of experienced consultants in the field, investors are able to ensure that the process is completed in a professional and timely manner, as well as in compliance with the regulations.