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Accenture has been chosen as the technology delivery partner to coordinate the replacement of the Bank of England’s 24-year-old Real-Time Gross Settlement (RTGS) system.
The project, due for completion in 2025, will see the replacement of the core system it uses to settle payments between banks, which is a critical part of the UK’s payments infrastructure, with a system harnessing the latest digital technologies. On an average day, the system settles about £685bn worth of transactions.
The initial research phase of the replacement project established five broad goals – higher resilience, broader access, wider interoperability, improved user functionality and strengthened end-to-end risk management.
The Bank of England published a contract notice in the Official Journal of the European Union in February 2019, inviting potential providers to express their interest. At the time, the contract was worth a maximum of £150m, including technology and support.
Accenture will support a carefully planned project that will culminate in a huge system migration.
Speaking to Computer Weekly last year, Victoria Cleland, executive director of banking, payments and innovation at the Bank of England, said: “I expect a big bang cutover because what you have with RTGS is the core ledger supporting payment transactions worth hundreds of billions of pounds a day, and we can’t have some members on it while others are not.”
Part of the challenge is ensuring all organisations that link in to the RTGS are also prepared for the cutover.
Read more about Bank of England IT
- The Bank of England will migrate from its current core settlement system with a ‘big-bang’ migration before the end of 2025.
- The Bank of England admits there is room for improvement when it comes to IT efficiency.
- Bank prepares to replace one of the UK’s core financial systems, with Real Time Gross Settlement service set to be modernised.
The bank wants to utilise modern IT, increase the number of companies that connect directly to the system and make it available 24 hours a day.
Although, like most major IT systems, there have been many small upgrades to the RTGS system over the years, the pace of change in the industry around it has meant that a major upgrade was required.
“It gets to the point where if you were to make fundamental changes, such as making it available 24/7 and increasing capacity, it is better to start from scratch,” said Cleland.
This has also meant timelines have changed. Back in 2016, the Bank of England set 2020 as the date to replace RTGS, but it is now expected to be finalised in 2025.
Sulabh Agarwal, a managing director at Accenture who leads its global payments practice, said the project is one of the most important initiatives for the UK payments system.
“The rise of digital and instant payments in recent years has dramatically changed the way we pay, reflecting changes in the needs of households and companies,” he said. “The renewed system will enable financial institutions to access a more modern and secure payments platform which is fit for the future.”