Today, 23 July 2015, Chaps has confirmed that its operational hours will be extended from summer 2016 by one hour and forty minutes.
The exact date will be confirmed later this year. This follows an 18 month review by the Bank of England in its role as owner of the Real Time Gross Settlement System (RTGS) system, which is used to settle CHAPS payments. The extended hours will also apply to other users of the RTGS, including CREST, the UK’s securities settlement system.
This change increases market accessibility and better aligns the settlement day with the typical business day. Enabling Direct Participants to make high-value sterling CHAPS payments up until 18:00 UK time, Monday-Friday will allow them to offer later cut-off times to their own customers. Any other payment service provider offering CHAPS payments to customers will publish any changes to cut-off times in their terms and conditions.
Increased availability should be good news to both individuals and businesses alike, giving them more time in the day to make a critical payment. Individuals most commonly make CHAPS payments when purchasing a house or a high-value item.
CHAPS processes 92% of sterling value payments, with the vast majority (78%) being wholesale financial payments, both domestic and international. The new operating hours will also provide an increased overlap between CHAPS’ settlement hours and counterparties operating in other financial markets and/or trading in other time zones and regions, such as the United States and Canada.
Mark Hale, CEO, CHAPS said: "CHAPS Co has listened to its users, and is delighted to enhance its service offering to better meet their needs. Our consultation with the financial services community and the users of CHAPS and Euroclear UK & Ireland, the operators of CREST, demonstrated that their ability to make high-value sterling payments later in the business day would provide tangible benefits.
“CHAPS is a fundamental market utility which processes 92% of sterling payments in value and it is critical that we are aligned with the needs of all users, from wholesale banks and corporates to individuals.”