House payments delayed by 'global payments issue' – BBC.com

The Bank of England said a “global payments issue” that may have delayed some large, time-sensitive payments, including home purchases, has been resolved.

The bank said payments made through Thursday through the CHAPS system, which is used by large traditional banks and international financial institutions, would be settled by the end of the day.

Anyone with concerns about paying their CHAPS bill is advised to contact their bank.

The issue did not affect regular debit and credit card payments, cash machine transactions or bank transfers.

“We are pleased to confirm that our third-party suppliers have restored service from the previous issues and CHAPS payments are being settled as normal,” the bank said.

“We expect all payments received by the bank today to be settled by the end of the day.”

Overall, 200,000 payments are made via CHAP every day in the UK, amounting to £363 billion.

The issue occurred within a wider global network known as Swift. It is understood the glitch is not being considered a cyber incident.

Banks and lenders use the CHAPS system to transfer funds between each other.

Thousands of financial institutions in the UK may have been directly or indirectly affected.

However, individuals are using it to send larger amounts such as completing a house or buying a car, with an average of around 4,000 housing transactions taking place per day.

“This could be a nightmare scenario for homebuyers on the day of completion, leaving buyers and moving trucks with packed belongings and nowhere to go,” said Andrew Montlake of mortgage broker Coleco.

“The home buying process relies on this system so it’s worthwhile for buyers looking to complete to call their conveyancer to ensure all is in order.”

An attorney may agree to complete a real estate transaction with the understanding that funds will be transferred at a later date, but the chain of custody may be affected.

The issue is partly due to the Swift system, an international financial artery that allows smooth and fast transfers of money across borders. Swift stands for Society for Worldwide Interbank Financial Telecommunication.

Founded in 1973 and based in Belgium, Swift connects 11,000 banks and institutions in more than 200 countries.

It is not a bank per se, but a cooperative that operates an instant messaging system that notifies users when payments have been sent and arrived.

Trillions of dollars pass between businesses and governments, and more than 40 million messages are sent every day.