Artificial intelligence (AI) is here. And it’s already reshaping the way law firms operate. Whether…
We would just like to remind all CA members that starting this Thursday, 1st May, ‘purpose codes’ will need to be included in property transactions, as required by the Bank of England (BoE). This is part of a broader shift to a new global standard in payment messaging.
Purpose codes help identify why money is being transferred between two bank accounts. According to the BoE, including this extra information is aimed at tackling money laundering and financial crime by making it harder to move funds without clearly identifying who’s involved.
This change is part of the move to ISO 20022, a new payment messaging standard that requires more detailed data. The BoE says this should help improve efficiency, prioritise payments, and strengthen efforts to prevent financial crime.
Firms should already be using Purpose Codes for some of their transactions and should be selecting the correct code for CHAPS payments when the payment relates to the items below:
From 1st May the Bank of England will also encourage the use of codes that are indirectly related to property transactions, for example:
| Purpose Code | Name | Definition |
| PTXP | Property Tax | Transaction is related to a payment of property tax |
| PPTI | Property Insurance | Transaction is a payment of property insurance |
| BLDM | Building Maintenance | Transaction is related to a payment associated with building maintenance. |
These changes are expected to have little impact on firms that make CHAPS payments manually through online banking, since they’ll simply choose a Purpose Code from a drop-down list provided by their bank. However, firms that export bulk payment lists from their case management or accounts platforms and upload them for CHAPS payments will be affected.
More information can be found here via the Bank of England website.
Related Posts
