BoE Undertakes Proof of Concept to Understand Renewed RTGS Service
BoE is undertaking a Proof of Concept to understand how a renewed Real Time Gross Settlement (RTGS) service could be capable of supporting settlement in systems operating on innovative payment technologies, such as those built on Distributed Ledger Technology (DLT). BoE expects to publish a summary of findings from the Proof of Concept later in 2018. The findings will set out any enhancements to the settlement functionality offered in the renewed RTGS service to accommodate payment systems using innovative technologies.
BoE is partnering with a range of firms developing payment arrangements using innovative technologies: Baton Systems, Clearmatics Technologies Ltd, R3, and Token. These firms are engaging with the Proof of Concept in several ways. The inclusion of multiple firms in the Proof of Concept will give broader insight into the range of functionality BoE might need to offer to support this sector. Participants in the Proof of Concept have access to a cloud-based system developed by BoE, which replicates a version of the prefunded net settlement arrangement a renewed RTGS service will offer to the major UK retail payment systems. The Proof of Concept is exploring whether innovative settlement systems are able to interface with that functionality and identifying ways in which the renewed RTGS service functionality could be expanded.
BoE has set out its vision for a renewed RTGS service that will deliver a materially stronger, more resilient, flexible, and innovative sterling settlement system for the UK to respond to the rapidly changing payments landscape. The RTGS blueprint, which was published in May 2017, stated that the renewed service will offer a diverse and flexible range of settlement models, to enable existing and emerging payment infrastructures to access central bank money. Although the BoE has concluded that DLT is not yet sufficiently mature to provide the core for the next generation of RTGS, it places a high priority on ensuring that the new service is capable of interfacing with DLT, as and when it is developed in the wider sterling markets.
Related Links
Keywords: Europe, UK, PMI, DLT, Payment Systems, Fintech, RTGS, BoE
Related Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
