The Bank, working closely with the payments industry, has today successfully migrated CHAPS, the UK’s high-value payments system, to ISO 20022 – the latest global financial messaging standard. This marks a significant milestone in the multi-year programme to renew the Bank’s Real Time Gross Settlement (RTGS) service: a programme whose objectives are to increase resilience, competition and innovation within the payments landscape.
It also marks a key milestone in the global transition of payments to ISO 20022. The ISO 20022 standard allows more data to be sent with payments, and in a more structured format. ISO 20022 is an open international standard, which has the potential to create a single common language for most payments globally and deliver a wide range of benefits. In addition to the UK, many major jurisdictions have or are intending to implement ISO 20022 by November 2025, when SWIFT is scheduled to retire its existing MT message standard for cross-border payments. Pay.UK’s New Payments Architecture, which will replace the UK’s Faster Payments system in due course, will also use ISO 20022.
ISO 20022 delivers a wide range of benefits to individual institutions and, through greater global harmonisation, enhances cross border payments. The key benefits include:
Consumers and businesses are unlikely to need to change the way they send CHAPS or cross-border payments for now. However, they might start to see options to add further information or specific references (such as invoice numbers) with CHAPS payments towards the end of this year. We encourage consumers and business to contact their bank, building society or payment service provider if they have any queries.
Executive Director of Payments Victoria Cleland said:
“The introduction of the ISO 20022 financial messaging standard marks a major milestone in our mission to enhance our RTGS and CHAPS services: critical infrastructure at the heart of the financial system.
“In an increasingly globalised payments world, harmonisation of messaging through ISO 20022 will enable more systems to speak the same language and ultimately enhance cross border payments. The move to ISO 20022 is a key element in the Bank’s RTGS Renewal Programme and meets one of our commitments to the Financial Stability Board’s Roadmap to Enhance Cross Border Payments.
“ISO 20022 also provides great benefits for individual firms: I would encourage them all to embrace these benefits.
“I am very grateful to the teams in the Bank, to Accenture (our Technology Delivery Partner) and also to our CHAPS Direct Participants and the broader payments industry whose strong collaboration and commitment has made this transformational change possible.”
Today’s announcement is an important milestone in the Bank’s renewal of RTGS.
Our vision is to develop an RTGS service which supports the payments industry of the future by delivering key benefits such as: increased resilience and access, wider interoperability, improved user functionality and strengthened end-to-end risk management of CHAPS.
The next phase of the Programme, building on core infrastructure enhancements introduced today, will be the introduction of the new core settlement engine for RTGS due in summer 2024.
Notes to editors
CHAPS is one of the largest high-value payment systems in the world and was used to settle an average of £395 billion every day last year. This includes wholesale payments made by large institutions as well as individuals buying expensive items like cars or houses.
To help realise the full benefits of the ISO 20022 messaging standard, the Bank aims to mandate certain elements of enhanced data within CHAPS from November 2024. Subject to the outcome of the recent CPMI consultation on proposals for an enhanced minimum data standard for cross-border ISO 20022 payments, CHAPS intends to adopt this from November 2025.
ISO 20022 replaces the previous legacy SWIFT ‘MT’ standard, which SWIFT is retiring for payments in November 2025.
The FSB Roadmap, commissioned by the G20, sets out a high level plan of goals and milestones to address long-standing challenges around the high costs, low speed, limited access and insufficient transparency associated with cross-border payments. Adopting a harmonised ISO 20022 version for message formats forms one of the key ‘building blocks’ for this roadmap.
Further details on the RTGS Renewal Programme can be found here: RTGS Renewal Programme
Further general information about the RTGS/CHAPS service is available on the Bank’s website including A brief introduction to the Real-Time Gross Settlement system and CHAPS
Improved Flexibility: ISO 20022 can adapt more easily than current messaging standards. So it’s more responsive to changes in the economy, emerging technologies and innovation.
Global Harmonisation: Over 70 countries have already adopted ISO 20022, so messages will be harmonised with payment systems around the world.
Compliance and regulation: Richer data will make it easier for businesses to detect fraud and help target financial crime.
Resilience: ISO 20022 will be used across many payment systems. This improves resilience by allowing re-routing of messages which reduces the impact of outages on users.
Enriched data: More data can be carried. It enables more detailed and better structured reference information.
Competition and innovation: More flexibility means more competition and innovation in the financial sector. Better data can lead to product innovation
Straight-through processing: Less need for banks to make manual interventions. Potentially fewer delays for the end customer.
Enhanced Analytics: Enriched data will improve analytics. More efficient data collection will improve the decision making.