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BoE launches review into payments system failure

Bank of England governor Mark Carney has launched an independent review into a technical failure that meant no UK borrowers could access a mortgage for extended periods yesterday.

A glitch in the real time gross settlement payment system, which allows money to be transferred between banks in real time to fund investment banking and consumer loans, occurred after the Bank identified a technical issue during maintenance work and was forced to pause settlement.

The fault affected high-value same-day transfers, used by solicitors to transfer the mortgage during the house-buying process.

The problem was resolved in the latter part of the day, with the Bank extending opening hours until 8pm “to maximize the opportunity for settlement.”

Treasury select committee chairman Andrew Tyrie immediately wrote to Carney demanding an inquiry and the BoE governor has now launched an independent review in response to the disruption, which will cover the causes of the incident, the effectiveness of the Bank’s response and any future contingency plans.

It has not yet stated when the full report and response will be published.

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