Section 86

Subject to paragraphs (2) , (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. 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. Paragraph (2B) applies where the following conditions are met— 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 such grounds are established by no later than the end of the business day following the time of receipt of the payment order. 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. 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. Where a payment service provider delays a payment order under paragraph (2B)— the payer’s payment service provider must notify the payer of— the fact of the delay; the reasons for the delay; and any information or action required of the payer to enable the payment service provider to decide whether to execute the order; 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; the requirement in sub-paragraph (a) does not apply to the extent complying with it would be otherwise unlawful. Where a payment transaction— 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. does not fall within paragraphs (a) to (c) of regulation 85(1) or regulation 85(1A); but is to be executed wholly within the United Kingdom, 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. 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.

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Source: legislation.gov.uk · retrieved 2026-09-04