The clearing house automated payment system (CHAPS) has reduced its participation fees by 50 percent, making payments more cost-effective for existing and prospective low-volume direct participants.
The same-day high-value payments system operator committed to restructuring its funding model in August 2014 in an aim to lower barriers for small or new banks that wish to join the system.
As a not-for-profit company, CHAPS’s funding model is designed only to cover its annual running costs.
Previously, the funding system was based on the number of volumes processes, with each direct participant paying a 2 percent contribution. This equated to a minimum cost of £80,000 for the year of 2014.
Now, the funding tool comprises of two elements. There will be a fixed annual shareholder charge of £3,000, which will decrease proportionately as the number of shareholders increases. On top of this, direct participants can expect to pay a minimum of £40,000 in annual aggregate costs for 2015, making a 50 percent saving on the previous year.
Phil Kenworthy, managing director of CHAPS, said: “We are proud to have delivered a fairer funding model. It will ensure that the CHAPS scheme is more equitable and simple; delivering benefits to both existing and prospective low-volume participants.”
“We are seeing a greater interest from payment service providers in directly joining CHAPS, and we anticipate growth in our direct participation over the next two years as a result of this and other initiatives planned for 2015.”
