Who has the money when it is being transferred?
Question
When you transfer money to a friend, it leaves your account immediately, but doesn't reach your friend for five days. Who has the money for the days in between and who gets the interest?
Peter, Ilford
Answer
** Definitive
Name: Julie, Westminster
Qualification: Irritation at bankers!
Answer: I used to be really annoyed by banks taking a long time, as we're the last country in the western world to do this. Banks do hold your money for the three, five or seven days before transferring it and they do make interest on it. It happens with both the bank it's transferring from and the bank it's transferring to. They say it is because they need to manually check the transfers. But due to pressure, they came up with the Faster Payment Transfer system and now around 13 banks have signed up, meaning they will clear transfers within two hours.