On 13 August 2018, the Bank of England issued a call for interest on synchronised settlement in central bank money.
Synchronisation is the ability to synchronise cash movements in the Bank of England’s (BoE) Real-Time Gross Settlement (RTGS) service with the movement of cash or assets in other systems. The BoE believes that this functionality could provide an opportunity to reduce cost and risk, improve efficiency, and support innovative new methods of settlement. The BoE is looking to explore the potential for this functionality with a small group of organisations.
The BoE reports that it has received feedback suggesting that the new functionality could be used in cases such as housing transactions; corporate transactions; and cross border payments. The BoE is currently focussing on a model of synchronisation in which the RTGS service could have the functionality required for a trusted third party (the ‘Synchronisation Operator’) to connect and offer synchronisation services to the market.
The BoE is seeking to engage with firms to offer opinions on:
- how a Synchronisation Operator could connect to the renewed RTGS service;
- what functionality and capabilities the renewed RTGS service might need in order for third parties to offer innovative synchronisation services;
- what functionality a Synchronisation Operator might need in its own systems in order to deliver synchronisation services; and
- the BoE’s policy with regards to how it expects this functionality to be used.
The deadline to register interest is 28 September 2018.