Chaps, the UK's high value payments system for sterling clearing, has moved to a euro-compatible platform.
The upgrade, which puts Chaps Sterling on a common footing with Chaps Euro, followed a 20-month long project. The system, dubbed NewChaps, uses a platform based on the interbank Swift network and its FIN-Copy service.
The move significantly improves the capabilites of the ageing Chaps sterling network, which was first introduced for same-day clearing in 1984. Chaps is the second largest real-time gross settlement system in the world (after Fedwire in the USA) and each day transfers values averaging £300 billion (£200 billion in sterling and £100 billion equivalent in euro).
The migration to a new platform is designed to prepare banks for the possibility of the UK joining Economic and Monetary Union and, as a consequence, competition with other payment systems and the loss of domestic monopoly. NewChaps also provides for new market developments, including the introduction of Delivery versus Payment (DvP) and Continuous Linked Settlement (CLS), says UK payments body Apacs, which co-ordinated the effort.