Bank of England to Update Settlement Technology
The Bank of England, hoping to better fend off cyber-attacks and better serve smaller financial services providers, will upgrade its Real-Time Gross Settlement system.
The system, which handles transactions worth about $659 billion per day, will undergo a “comprehensive rebuild” by 2020, according to a provisional goal issued by the bank. It will publish a more specific timetable next year, it said.
“The world of payments is changing rapidly, and central banks need to keep pace if we are to deliver our mission of monetary and financial stability effectively in the years to come, whilst also enabling innovation and competition where we can” said Andrew Hauser, executive director for banking, payments and financial resilience. “The proposals in this consultation document set out the changes the Bank of England believes are needed to deliver a new generation of RTGS service to meet that challenge.”
The plan, accessible here, calls for such factors as:
- Having the system run 24/7 instead of during traditional working hours.
- Giving access to non-bank payment service providers to settlement accounts.
- API interface for “richer access to payment and liquidity data.”
- Be able to work with “distributed ledgers,” or blockchains, the technology that supports bitcoin transactions.
“The cost of the rebuild will be recouped from future users in the normal way over time through a temporary increase in the RTGS tariff,” the bank said.