The infrastructure that processes large payments including house purchases between British banks has gone offline, reports The Telegraph.
The central bank said the “Real Time Gross Settlement Payment System” (RTGS), which settles large transfers between banks, had gone offline, and remained so on Monday morning.
It said that the biggest payments were being processed manually and reassured the public that all payments would be on Monday, since the system has the capacity to process a large number of payments when it does go back online.
Smaller payments such as standing orders and direct debits use a different system and have not been affected.
The RTGS is set up to settle large payments in real time, rather than at the end of the day, reducing risk.
The system – which processes payments such as house purchases – has been down since 6am on Monday morning.
“The Bank of England has identified a technical issue related to some routine maintenance of the RTGS payment system and has paused settlement while we resolve it,” a statement from the Bank said.
“We are working to address this issue as quickly as possible, and restart the RTGS payment system in a controlled manner.
“The most important payments are being made manually and we can reassure the public that all payments made today will be processed.”
The RTGS routes payments made through CHAPS (the Clearing House Automated Payments System), which settles important and time-sensitive payments, including house purchases.
According to the CHAPS website, it processed £70 trillion of payments last year and is used by 5,000 financial institutions.
The system helps keep the day-to-day running of banks going by acting as an intermediary between banks. If a payment is going to be made between banks, RTGS credits the bank receiving the funds quickly, and takes funds from the bank sending money, removing the risk for the receiving bank.
Image: Bank of England via Shutterstock