Bank of England to review payment system outage

Out-Law News | 21 Oct 2014 | 12:45 pm | 1 min. read

An independent review has been launched into the cause of disruption to a major UK payment system on Monday and the Bank of England's (the Bank's) response to the incident.

The Bank's own real-time gross settlement (RTGS) system was off-line most of the day on Monday causing a backlog of more than 140,000 CHAPS (Clearing House Automated Payment System) payments.

The system was restored late on Monday afternoon and the Bank said it cleared all 142,759 payments that were outstanding on the system before it was closed for the day at 8pm. However, Bank of England governor Mark Carney called a review into the causes of the disruption and how the Bank responded to the fault.

"The governor of the Bank of England, Mark Carney, has launched a thorough, independent review of the causes of today’s disruption to RTGS, the Bank's system for settling high value payments," the Bank said in a statement. "The review will cover the causes of the incident, the effectiveness of the Bank’s response and the lessons learned for future contingency plans. Its findings will be presented to Court which will then publish the full report and the response."

On Monday, the Bank reported that it had halted the operation of its RTGS system after a technical fault was identified. The problem was caused during "routine maintenance", a spokesperson for the Bank said. Typically, the Bank's RTGS system handles 138,000 CHAPS payments every day, worth an average daily value of £277 billion.

The Bank of England, together with the FCA, has been reviewing how banks and building societies manage the risk of IT outages. It is due to report its findings early next year.