Payment systems

Payments that settle within seconds, at any hour, including weekends and public holidays, rather than in batches on working days.

Switzerland launched instant payments on 20 August 2024, on the SIC5 platform operated by SIX for the Swiss National Bank. Institutions that handled more than 500,000 incoming customer payments in 2020 had to be able to receive them from that date, covering over 95% of Swiss customer payments; the remaining institutions follow by the end of 2026.

An important nuance: receiving instant payments is compulsory, while sending them remains optional and is often charged. Elsewhere, the equivalent schemes are SEPA Instant in the euro area and Faster Payments in the UK.

The shift matters for reconciliation: when funds and the account statement arrive together, matching a payment to an invoice stops being an end-of-day exercise.

A broad term for the infrastructure and mechanisms that move funds between parties.

It covers:

• Card networks such as Visa and Mastercard.
• Banking rails such as SEPA, SWIFT and ACH.
• Instant payment schemes such as SEPA Instant and Faster Payments.

These systems are overseen by central banks and regulators. In Switzerland, SIX Interbank Clearing operates the domestic system on behalf of the Swiss National Bank.

The Single Euro Payments Area: an EU initiative that standardises euro-denominated bank transfers so that cross-border payments work like domestic ones.

It defines three main schemes:

• SEPA Credit Transfer (SCT): a euro transfer from one bank account to another.
• SEPA Direct Debit (SDD): a euro debit taken from a payer's account with their authorisation.
• SEPA Instant Credit Transfer (SCT Inst): a euro transfer that settles within seconds.

SEPA covers more than 30 countries, including Switzerland, which participates for euro payments while keeping the Swiss franc outside the scheme.

Bankers' Automated Clearing Services: the UK system for direct debits and credit transfers between UK bank accounts.

Identified by: no code of its own; payments are addressed with a six-digit sort code and account number.

Commonly used for salary payments, bill payments and government disbursements. BACS runs on a three-working-day cycle, which is why urgent UK payments go through Faster Payments or CHAPS instead.

The Automated Clearing House: the US network for processing high volumes of electronic credit and debit transactions in batches.

Identified by: a nine-digit ABA routing number plus the bank account number.

Used for payroll, direct deposit, utility bills, mortgage payments and government transfers. ACH suits recurring and batch payments rather than urgent ones, since transactions settle in batches rather than instantly.