The Bank of England's £431 million project to replace its core IT system was worth the cost and demonstrated good digital transformation practice, according to the National Audit Office (NAO).
Total costs increased by 15% compared to the £375 million budget set in 2020, according to the spending watchdog.
He said projectThe program, which began eight years ago and ended in April this year, also offers lessons for other government department projects.
The Real Time Gross Settlement System (RTGS) settles payments made through systems such as the Clearing House Automated Payment System and Bankers' Automated Clearing Services. It has been in use since 1996 and is essential for ensuring cash flow in the economy.
Planning began in 2017, but when work on the RTGS replacement project actually began in 2019, the bank said it would be moving away from the then 23-year-old system as soon as possible. “Big Bang” migration in 2025.
Conversation with Computer Weekly in July 2025upon completion of the project, Chief Information Officer and Chief Technology Officer of the Bank of England Nathan Monk described the project as “one hell of a journey”.
Following the publication of the NAO report, Gareth Davies, the watchdog's chief executive, said RTGS was part of the nation's critical infrastructure. “The bank has a strong focus on the RTGS renewal program coupled with a low tolerance for failure,” he said. “Careful planning and a well-managed delivery approach ensured value for money and served as an example of best practice and innovation for future digital change projects.”
In 2017, the bank came up with plan of this set main goals systems to replace the outdated RTGS, and a year later Monk joined the team. “The Bank of England has successfully navigated complex risks and interdependencies to deliver its RTGS upgrade programme, incorporating innovation and best practice in managing this digital transformation,” the NAO said.
The program's staffing levels peaked at more than 450 employees in 2022 and 2023.
The new system involves a move away from traditional mainframe technologies that have dominated financial institutions and toward “more modular, loosely coupled technologies,” Monk said.
“It's an ecosystem of products, off-the-shelf, best-of-breed products, and then we coded the core ourselves because there was nothing available that met our requirements or needs,” he said. “It goes from legacy technologies to new technologies and then builds on off-the-shelf products with a custom-designed core.”
It was launched in April this year when work on the new core settlement mechanism was completed. “This is the beating heart, and it contains all the logic for calculating all payments. [sits]said Monk.
Coordination with the financial sector was critical. The bank has had to work hard to ensure that the entire industry joins it in its modernization journey because, as Monk puts it, “We're not the only ones changing things, we're having to change with the industry.”
In its latest report, the NAO recommends that the Bank of England prioritize maintaining and improving the system to maximize long-term value.
