Media Release Reform of Interbank Payments:
RTGS Business Specifications

On 6 July the Reserve Bank announced that it would be proceeding with a proposal to introduce a real-time gross settlement (RTGS) system for high-value interbank payments; this would be based on the existing Reserve Bank Information and Transfer System (RITS). The primary objective of this reform is to remove settlement risk from high-value interbank payments in Australia.

The Bank has now released draft business specifications for the RTGS system. These set out the scope of the system, its main elements and how it will operate. A key feature is that banks will return full control of their own payment flows. There will also be a number of automated facilities to assist banks in managing their liquidity.

Banks will be able to choose how they connect to the RTGS system. The Reserve Bank will provide facilities for banks to access it directly, or through any new or existing industry-sponsored payment system. All access will be subject to the highest levels of security.

The Reserve Bank will be holding further discussions with the banking industry and other interested parties over the next month or so, to confirm the business specifications and examine options for their effective implementation. It is expected that detailed technical specifications for the system will be released around the end of 1995, and the aim is to have the new system operational during 1997.

Copies of the specifications are available from the Information Office.