On 13 February 2023, the Bank of England (BoE) published a Consultation Response Paper on the Real-Time Gross Settlement (RTGS) – CHAPS tariff framework.
In April 2022, the BoE consulted on a set of proposals for a revised RTGS-CHAPS tariff framework. The consultation was conducted in the light of the changing payments landscape, new players in the industry and the BoE’s transformational programme to renew the RTGS service.
The BoE is in the process of renewing the RTGS service, with a move to enhanced ISO 20022 for CHAPS payments in June 2023, followed by the introduction of a new core settlement regime in September 2024. This consultation response document summarises the BoE’s decisions, taking into consideration industry feedback, and sets out the structures that will be used to recover the costs of the investment in, and the running of, the renewed RTGS service.
Overall, the majority of respondents to the April consultation were broadly supportive of the key proposals, highlighting that they are consistent with the BoE’s tariff principles. A number of respondents specifically acknowledged that there will always be a trade-off between principles, regardless of the ultimate approach, and supported the balance that the BoE has struck.
The main area of challenge was the CHAPS fee structure, in particular responses around both the proposed tiered fixed fee and the introduction of a value-based usage charge. The BoE has therefore undertaken further analysis on this element.