IT glitches and operational risk

The Payments System Board has released a report setting out the Board’s conclusions from an informal consultation on operational incidents in retail payments systems over the last few years which caused considerable disruption to customers of the authorised deposit-taking institutions (ADIs) in question, as well as to other ADIs and their customers.

The Reserve Bank previously announced it would be formalising a requirement for RITS members to report significant retail operational incidents.

The report identifies the operational risk that arises from the continued use of legacy systems; until recently many participants have tended to underinvest in payments infrastructure.

The Board has concluded that at present there is no need for a regulatory response to operational incidents in this sector. It is proposed that at least for the time being the Bank’s role be limited to monitoring retail operational incidents and collecting data on them.

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