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Bank of England to build new RTGS system

The Bank of England plans to comprehensively rebuild its real-time gross settlement (RTGS) technology platform by 2020, the bank announced on Friday.

Five key strategic requirements for the next generation of RTGS have been set out by a group of stakeholders that provided input into plans for rebuilding the bank's RTGS system. They are:

  1. Be capable of responding to the changing structure of the financial system;
  2. Recognise that payment system users want simpler and more resilient pathways for their payments;
  3. Be capable of interfacing with a range of new technologies being used in the private sector, including distributed ledgers, if/when they achieve critical mass;
  4. Remain highly resilient to the increasingly diverse range of threats to continuity of service; and
  5. Have the capacity to support the future evolution of regulatory and monetary policy tools.

The bank's executive director for banking, payments and financial resilience, Andrew Hauser, 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. 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 UK's RTGS settles on average around £500 billion daily between banks. The bank's statement said that the new system would be financed through fees paid by its future users. According to the bank, it's proposals are intended to provide broader access, higher resilience, greater interoperability, and a wider range of user functionality, as summarised in the table below:

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