Victoria Cleland, Executive Director for Banking, Payments and Innovation at BoE, has delivered a speech at the UK Finance Summer Network Event on the benefits of BoE’s multi-year programme to renew the RTGS system.
In June, BoE migrated CHAPS to ISO 20022, marking the first stage of its major transformation plans.
In terms of immediate benefits, the transition to ISO 20022 will achieve quicker end-to-end payments for CHAPS Direct Participants. BoE is also collaborating with UK Finance to develop a framework for how payments should be prioritised during operational disruption, ensuring that urgent payments like salaries and benefits are prioritised, making the whole financial system more resilient.
BoE’s focus is now on the second phase of benefits, and the new core settlement engine for RTGS, due to launch next summer.
Looking forward to the third phase of benefits, Cleland envisioned RTGS acting as an open platform for change. Top priorities for innovation include a synchronisation interface to connect RTGS with other ledgers, and extended RTGS operating hours. The former would introduce synchronised settlement, putting BoE in a strong position to integrate central bank digital money in RTGS. It would allow interoperability with other asset ledgers such as land registers or overseas systems, helping to reduce settlement risk and liquidity costs for a range of markets.