According to the Bank of England, a “global payments issue” involved large-value payments, including house purchases, settled through the national real-time gross settlement system, Ch.
Chaps, used to process large time-sensitive payments for football player purchases, art deals and home completions, was last down for six hours in August last year. The daily value of payments through the system is over £300 billion per day.
The “global payments issue” cited by the bank is believed to be related to issues connecting to the Swift financial messaging network.
“We are aware of the likely impact and are working closely with a third party provider, industry and other authorities to resolve the issue as quickly as possible,” the central bank says.
BofE recommends that consumers and businesses contact their bank or other payment service provider if they have concerns about a payment.
“Retail payment systems are not affected, so individuals and companies can continue to use ATMs, card payments and bank transfers as usual,” explains the bank.
The bank has offered no explanation for the outage, the third major technical error to occur in the crucial bank-to-bank payments infrastructure in the past decade.
In 2015, the Bank of England was ordered to improve emergency preparedness and strengthen its crisis management framework following an independent review of a ten-hour Chaps breakdown the previous year.
In March 2019, the central bank was heavily criticized by a Common Select Committee for its outdated technology inventory, culture and procurement activities.
The bank has since embarked on a broader multi-year RTGS service renewal program, which will see the introduction of a new core settlement engine, the implementation of which was originally scheduled for this summer.
To update: In a statement about the six-hour glitch late this afternoon, the Bank of England said: “We are pleased to confirm that the third party provider has restored its service following its previous issues and CHAPS payments are being processed as normal.”
“We expect that all payments received by the bank today will be settled by the end of the day.”