IBS Journal February 2015
Reserve Bank of New Zealand to overhaul domestic payments infrastructure
The Reserve Bank of New Zealand (RBNZ) is moving forward with plans to mod- ernise the country’s national payments infrastructure. RBNZ has invited vendors to present expressions of interest (ROI) to install a new real-time gross settlement (RTGS) system to replace the bank’s leg- acy technology. Suppliers had until 27th January to respond to the ROI. In addition, RBNZ intends to divest the operation of the country’s securities settlement plat- form, known as NZ Clear, to the private sector with a separate bidding process due to commence later this year. New Zealand currently operates
two proprietary platforms for RTGS, one known as ESAS and the other the afore- mentioned NZ Clear. ESAS processes payment instructions between settle- ment account holders for retail payments, whilst NZClear allows members to set- tle the sale and purchase of securities lodged in the system through delivery versus payment (DvP). Both systems run on the same technology and are inter- linked, using Oracle servers and an Oracle database. However, the hardware only has two more years of support, which has prompted the review into the technology landscape. A consultation carried out by RBNZ
with Ernst & Young over the course of the last year found that there were also struc- tural challenges with operating these two systems. One of the main ones cited was the lack of ability to innovate, as changes
RBNZ HQ, Wellington ©itravelNZ, Flickr
to one system would require high costs and changes to the other. There is also complexity and risk associated with main- taining both legacy platforms, with the technology dating back to the 1990s. Industry participants who respond-
ed to the consultation suggested that the main requirements for any new technolo- gy platform should be real-time settle- ment functionality, compatibility with international standards such as ISO 20022 and 24x7 operability with 99.9 per cent up-time. Australia’s attempts to build a real-time settlement infrastructure, which have reached a crucial stage with Swift being chosen as the technology supplier,
were also referenced as something which the New Zealand market desires. ‘The gen- eral consensus was that a near real-time system with real-time clearing, but fre- quent batched settlement, was appro- priate for the New Zealand retail market,’ states the report.
Notable suppliers in this space include
CMA Small Systems, the Sweden-based vendor with Russian roots; US-based Mon- tran Corporation, which has a foothold in this region with a live customer at Bank of Papua New Guinea; Perago, the subsidi- ary of the Italian software firm SIA; and the Logica-derived business now under the ownership of Canada-based CGI.
IN BRIEF
Summit Bank, a medium-sized player in Pakistan, is looking for a new core bank- ing system. The bank is among the fastest growing institutions in the country and is looking to expand its Islamic banking activities. The bank is a result of a 2010/11 merger of three domestic players: Atlas Bank, Mybank and Arif Habib Bank. Atlas Bank was a user of Temenos’ T24 system, Mybank was using Misys’ Equation and Arif Habib Bank had the Hplus core system from a small local provider, Bilogic, and the Autobanker treasury module from another local vendor, Autosoft Dynamics. The bank has issued an RFP, and proposals were requested by early January
Karachi, home of Summit Bank
2015. It is understood that the legacy suppliers – Misys, Temenos and Autosoft Dynamics – are participating in the bidding process, as well as Oracle FSS with its Flexcube core offering and Path Solutions with iMAL.
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© IBS Intelligence 2015
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news: system selections
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