EFT / Bank Transfer Authorisation Form (UK)

An EFT / Bank Transfer Authorisation Form in the United Kingdom is a legally binding written instrument.

The legal framework governing electronic fund transfers in the United Kingdom is established primarily by the Payment Services Regulations 2017 (PSR 2017, SI 2017/752), which implement in UK domestic law the requirements of the EU Payment Services Directive 2 (PSD2, EU Directive 2015/2366) as retained after Brexit by the European Union (Withdrawal) Act 2018. The PSR 2017 set out the rights and obligations of payment service providers (banks, building societies, and electronic money institutions authorised by the Financial Conduct Authority) and their customers, including execution timeframes for payment orders, liability for unauthorised transactions, and the consumer's right to a refund.

The PSR 2017 are supplemented by the FCA's Banking Conduct of Business Sourcebook (BCOBS) and the Payment Systems Regulator's rules and directions, which govern the conduct of payment systems operators including Pay.UK and CHAPS. The Confirmation of Payee (CoP) scheme, introduced by Pay.UK in 2020 following a direction from the Payment Systems Regulator, requires banks to check payee name against account details before processing Faster Payments and CHAPS transfers, significantly reducing authorised push payment (APP) fraud.

A UK EFT Authorisation Form captures the bank account details — sort code, account number, and account holder name — needed to initiate a transfer, and records the scope and purpose of the authorisation. The form is used in a variety of business contexts: payroll departments use EFT authorisation forms to set up employee salary payment details; accounts payable departments use them to register supplier bank details for invoice payments; treasury teams use them to authorise intercompany transfers; and HR departments use them to register employee bank accounts for expense reimbursements and benefit payments.

The EFT Authorisation Form differs from a Direct Debit Mandate in a fundamental respect: a Direct Debit Mandate authorises a third party to pull variable amounts from the account on a recurring basis with advance notice; an EFT Authorisation Form establishes the bank account details to which push payments will be made by the authorising party, typically on a one-time or recurring basis at amounts determined by the authorising party.

A UK EFT Authorisation Form is needed whenever a business or organisation needs to collect and securely record bank account details from employees, suppliers, customers, or other payees to enable electronic fund transfers, and wishes to do so through a documented, auditable authorisation process.

Employers processing payroll through BACS Direct Credit — the standard mechanism for paying employee salaries in the United Kingdom, processing over 3 billion payments per year — must collect each employee's sort code, account number, and account holder name before the first salary payment is made. An EFT Authorisation Form provides the documented record of the employee's bank account details, reducing the risk of misdirected salary payments and providing an audit trail for payroll processing under the HMRC PAYE obligations of the Income Tax (PAYE) Regulations 2003 (SI 2003/2682).

Finance teams processing supplier invoice payments via Faster Payments or BACS Direct Credit need to verify and record supplier bank account details before setting up new payees in their accounting systems. An EFT Authorisation Form signed by an authorised representative of the supplier provides evidential confirmation of the correct payee details and supports the organisation's fraud prevention controls, which are particularly important given the rise of business email compromise (BEC) fraud targeting accounts payable functions.

HR departments administering employee expense reimbursements, shift allowances, or one-off bonus payments to employees whose usual payroll details may not be held in the main payroll system use EFT Authorisation Forms to collect and verify the relevant bank account details before processing payments through the BACS Direct Credit or Faster Payments network.

Organisations making insurance claim settlements, legal damages payments, or grant disbursements to individuals or businesses use EFT Authorisation Forms to confirm the correct payee details before processing payments. The form provides documentary evidence that the payee has authorised the specific account to receive funds, which is important for anti-money laundering compliance under the Proceeds of Crime Act 2002 and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

Treasury teams managing intercompany fund transfers between group entities registered at Companies House use EFT Authorisation Forms to maintain a formal record of the authorised bank accounts for intercompany settlement, supporting the group's internal controls and external audit requirements under the Companies Act 2006.

A UK EFT Authorisation Form must include the following elements to provide a complete, verifiable record of the bank account details and the scope of the authorisation for electronic fund transfers.

The account holder name must be stated exactly as it appears on the bank account. Under the Confirmation of Payee scheme operated by Pay.UK, sending banks now verify the payee name against account details for Faster Payments and CHAPS transfers above certain thresholds. An incorrect or abbreviated payee name may cause a CoP mismatch warning, delaying the payment or alerting the sending bank's fraud systems. The EFT Authorisation Form should collect the exact account name used by the bank.

The sort code — six digits in the format XX-XX-XX — identifies the payee's bank and branch within the UK banking system. Sort codes are maintained by Pay.UK through the Sort Code Database (SCDB). The authorisation form should provide the correct format to prevent entry errors, which are one of the most common causes of misdirected payments.

The account number — eight digits — identifies the specific account within the bank identified by the sort code. Together, the sort code and account number uniquely identify the UK bank account. The EFT Authorisation Form should note that building society account holders may need to provide their roll number in addition to the sort code and account number, as some building society accounts require a roll number for Direct Credit payments.

The IBAN (International Bank Account Number) should be requested where the payee's account may be used to receive international transfers. UK IBANs are 22 characters long (format: GB + 2 check digits + 4-character bank identifier + 6-digit sort code + 8-digit account number). IBAN is required for SEPA transfers and CHAPS international payments.

The purpose and scope of the authorisation must be clearly stated — for example, 'salary payments', 'supplier invoice payments', 'expense reimbursements', or 'grant disbursements'. This scope limitation confirms the types of payments the account holder is authorising, and may include a frequency (monthly, ad hoc), an upper limit per transaction, or a time limit on the authorisation.

The account holder's signature and date confirm that the person named as the account holder has authorised the nominated account to receive the specified payments. For business accounts with multiple authorised signatories, the form should confirm that the signatory is authorised to approve payment details on behalf of the account-holding entity.

The data protection notice must confirm how the bank account details will be held and processed by the collecting organisation, in compliance with Articles 13 and 14 of the UK GDPR and the Data Protection Act 2018. Bank sort codes and account numbers are personal data in relation to individuals, and their processing must comply with the UK GDPR's data minimisation, security, and retention requirements.

Under the Financial Services and Markets Act 2000 (FSMA), the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) regulate financial services. The Consumer Credit Act 1974 governs consumer lending. HM Revenue and Customs (HMRC) applies stamp duty land tax under the Finance Act 2003. The Financial Ombudsman Service (FOS) resolves consumer financial disputes. The Bank of England sets monetary policy under the Bank of England Act 1998. The forms-legal.com EFT / Bank Transfer Authorisation Form (UK) template covers the mandatory elements under Financial Services and Markets Act 2000.