Payment provider Voca and cash machine network operator Link have been awarded a contract to build and manage a central infrastructure to allow faster online payments in the UK by 2007.

The project will ensure that internet and telephone banking payments are completed on the same day, rather than the three days it currently takes.

The deal’s value has not been disclosed, but in May 2005 banking industry trade body Apacs estimated that such a system would cost between £48m and £65m.

‘Our new system will enable customers to use the internet or phone to make a payment that will reach the recipient’s bank account within a few hours,’ said Apacs chief executive Paul Smee.

‘Successfully delivering this new system by 2007 is going to be extremely challenging, but the industry is confident that it will be achieved.’

Voca and Link have established a joint venture to build, deliver and manage the central systems for faster payments, which is being constructed to cater for much larger volumes of payments in the future.

‘Our new technology infrastructure for payments processing is complementary to Link’s real-time payments processing services. Together we offer a robust, cost-effective and low-risk solution,’ said Voca chief executive Marion King.

Link chief executive John Hardy said: ‘By working alongside each other we can offer an exceptional faster payments service to financial institutions that will set the benchmark for clearing in the European payments market.’

Internet, phone and standing order payments account for just seven per cent of automated payment volumes today, but are rapidly replacing cheques as the most popular form of payment.

The industry has been under pressure for some time to speed up online payments. Chancellor Gordon Brown first raised the issue in his 1998 pre-Budget Report, and has since given the industry a deadline of 2008 or face new legis lation. Most other major economies clear payments on the same or next day.