Quarterly Bulletin
Payment & Settlement Systems Articles
| Spring 2005 |
The
role of central banks in payment systems oversight 
(80k) (by Andrew G Haldane and Edwin Latter of the Bank's Market Infrastructure Division). Payment systems are essential to the functioning of monetary economies. This article explains the Bank's role in overseeing UK payment systems to ensure their robustness, including the role of the Bank's recently published first Oversight Report. It also sets out some future priorities for payment systems oversight in the light of international consolidation and technological innovation. |
| Summer 2004 | Reform
of the Bank of England's operations in the sterling money
markets. A consultative paper by the Bank of England
(455k) The Bank issued this paper for public consultation on 7 May 2004. It reviews the objectives and broad framework of the Bank of England's operations in the sterling money markets. Comments were invited by 11 June 2004. |
| Spring 2004 | The
relationship between the overnight interbank unsecured loan
market and the CHAPS Sterling system
(77k) (by Stephen Millard and Marco Polenghi of the Bank's Market Infrastructure Division). This article uses data on CHAPS Sterling transactions to describe the segment of the unsecured overnight loan market that settles within CHAPS. It assesses the size, timing and importance of these transactions for the underlying payments infrastructure. Advances and repayments of overnight loans are estimated to have accounted for around 20% of CHAPS Sterling activity by value over our sample period; four CHAPS Sterling members send and receive virtually all payments corresponding to these loans; and, finally, the value of CHAPS Sterling payments associated with this market rises towards the end of the CHAPS day. |
| Winter 2003 | Innovations
in retail payments: e-payments
(114k) (by Helen Allen of the Bank's Market Infrastructure Division). Ways to make retail payments using the internet and mobile phones are proliferating. Some are offering new access routes to existing payment means, others use different means to transfer value, but all attempt to provide greater convenience and choice in payment services. Few, however, have reached critical mass and none has displaced existing payment methods. Nevertheless, the prospect that these new services could be widely used raises some policy questions. For example, central banks are interested in any potential effects on financial stability and, in the longer term, in whether such innovation might have monetary policy implications. For these reasons, central banks monitor the evolution of the market, even though any such impacts may be a long way off. Moreover, it may well be that the system-wide risks will be relatively small even if e-payment usage becomes significant. |
| Summer 2003 | Foreign
Exchange Joint Standing Committee e-commerce subgroup report
(54k) This article describes recent developments in electronic trading in the foreign exchange market, based on a report produced by the e-commerce subgroup of the Foreign Exchange Joint Standing Committee. After a brief introduction to e-commerce in the context of the foreign exchange market, it discusses developments in electronic trading, including both single-bank and multi-bank internet-based systems, and explains market initiatives such as 'prime brokerage' and 'white labelling' that have been facilitated by electronic platforms. |
| February 1999 | Risk,
cost and liquidity in alternative payment systems
(66k) (by Maxwell Fry director of the Bank's Centre for Central Banking Studies). For its academic workshops and projects, the Bank of England's Centre for Central Banking Studies (CCBS) invites central bankers from as wide a range of countries as possible to analyse and compare their experiences of relevant issues, in a process of learning from diversity. Each workshop is followed by a three-month project, for which three to six foreign central bankers are invited to collaborate with Bank of England staff on research related to the workshop material. In this article, Maxwell Fry, director of the CCBS, summarises one aspect of the research conducted at the CCBS as part of its first academic workshop and project. This started with a one-week academic workshop on payment and settlement issues in January 1998, attended by participants from 22 central banks as well as international experts in the subject. After the workshop, six participants-three foreign central bankers and three Bank of England staff-assembled to plan a research programme for the ensuing ten weeks. The research built on the ideas presented at the academic workshop, as well as the specific interests of the team members. The results of the project research were first presented at a conference in March, which was co-hosted by the CCBS and the ESRC-supported Money, Macro and Finance Research Group. The project output also formed the basis for a report prepared for the Bank's 1998 Central Bank Governors' Symposium in June. Routledge will publish the final project output in April 1999. |
| May 1998 | Competition and co-operation:
developments in cross-border securities settlement and derivatives
clearing (63k) (by Bob Hills and Chris Young of the Bank's Payment and Settlement Policy Division). European securities settlement systems and derivatives clearing houses are preparing for EMU by offering members clearing and settlement services in foreign as well as domestic instruments. This article outlines recent developments and new initiatives in cross-border securities settlement and derivatives clearing. It suggests that competition for post-EMU business is already resulting in increased co-operation, in the form of links between systems. These developments have implications for the risks in cross-border clearing and settlement and for market structure, and raise issues for central banks and regulators. |
| February 1998 | Upgrading the Central Gilts Office (55k) (by Christopher P Mann of the Bank's Market Services Division and Controller of the CGO Project). The Central Gilts Office system, first introduced in 1986, was designed and built to meet basic market demands: the provision of settlement for gilt-edged securities through an efficient and secure system of electronic book-entry delivery of stock in real time against an assured payment. By 1994, it had become apparent that the system needed to be upgraded to reflect continuing improvements in information technology (especially in data security) and developments in market practices, as well as structural reforms in the gilt market and payments systems and the possibility of UK membership of European Monetary Union. This article explains the background to the decision taken in 1995 to upgrade the system, describes the process involved and sets out some of the features and changes introduced by the upgraded system. |
| August 1996 | Payment and settlement strategy (13k) The Bank of England announced in November last year that it proposed to review, with market participants and other interested parties, the strategic requirements for payment and settlement for UK financial markets. The review was conducted during the first half of this year and this note summarises its findings. It was presented by the Governor to the City Promotion Panel on 3 July. |
| February 1995 | The CREST project (36k) reports on progress in the development of the new equity settlement system, and looks ahead to the transition to CREST next year. |
| May 1994 | The development of a UK real-time gross settlement system (34k) explains the decision to move to real-time gross settlement arrangements and describes the main features of the new system, which is due to be implemented by the end of 1995. |
