Bank of England governor promises payments improvements

Bank of England governor promises payments improvements

The governor of the Bank of England says the central bank is exploring ways to expand membership of the Chaps large value payments network and improve performance in retail clearing.

At a set-piece speech in London on Monday, Mervyn King said that widening access to the UK large value payment system could lead to safer and more efficient payments. He said that wider membership of Chaps might permit a further reduction in interbank credit risk and make the financial system more resilient in a crisis.

"The technology for payments is constantly evolving. And central bank practices need to evolve with it," he said. "Our intention is to understand better what are the barriers to wider membership and how they can be lowered."

Separately, King chided the banking community for its poor performance in retail payments, pointing out that at that the UK now takes longer to clear payments – whether cheques or electronic payment – than almost any other member of the G10.

He said the Bank would work with the OFT taskforce - appointed by the government to look at UK payments practices - to explore ways in which that performance can be improved.

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