Bank of England Seeks FinTechs for Synchronised Settlement in the Renewed Real-time Gross Settlement Service
The Bank of England is seeking to work with a range of organisations, including fintech firms, to explore the demand for implementing synchronised settlement in the renewed Real-Time Gross Settlement service.
During 2018 the Bank engaged with financial institutions, infrastructures, trade bodies, policy makers and fintech firms on the concept of synchronised settlement in central bank money. Through this engagement a number of potential use cases for the functionality were identified, including; housing transactions, corporate transactions and cross-border payments.
At the heart of synchronisation is the concept of ‘atomic settlement’. This means that the transfer of two assets is linked in such a way as to ensure that the transfer of one asset occurs if and only if the transfer of the other asset also occurs. The Bank believes that for certain transaction types, this functionality could reduce cost and risk, improve efficiency, and support innovative new methods of settlement. Whilst the Bank is exploring whether it might implement this functionality as part of its renewal of the Real Time Gross Settlement (RTGS) service, third parties would need to create the platforms and products that will make use of it.
Therefore the Bank is now seeking to work with organisations to further explore the demand and potential for this functionality, as well as to understand the design implications for the Bank and the organisations which would interface with the Bank’s systems.
The Bank would like to hear from organisations that have use cases to share, as well as organisations which might be looking to connect to synchronisation functionality. To find out more, and to register your interest, please visit the Bank’s website or contact RTGSEngagement@bankofengland.co.uk.