RBA Risk Assessment on Bulk Clearing System End
The Reserve Bank of Australia today released its risk assessment into the payments industry’s proposed decommissioning of the Bulk Electronic Clearing System (BECS). The risk assessment concludes that industry is yet to arrive at a shared vision of the desired features of account-to-account payments in Australia and that there has been insufficient industry coordination, planning and certainty regarding the transition.
BECS is Australia’s primary system for account-to-account payments. Australians rely on BECS for a wide range of critical payments, including welfare, pension, salary, and bill payments. Given that a disruption to BECS payments has the potential to cause economic harm, the RBA expects any transition of these payments onto alternate rails to be orderly, safe and reliable.
The risk assessment makes a set of recommendations, with a number of these being considered as ‘foundational’. Industry should:
These recommendations are steps that the RBA expects industry to address with priority and urgency. This will necessitate some degree of reprioritisation to ensure the intended benefits of any transition in account-to-account payment rails are achieved and contingencies are appropriately considered. Following the recent meeting of the RBA’s Payments System Board, Assistant Governor (Financial System) Brad Jones noted, ‘As a serious disruption to account-to-account payments has the potential to undermine confidence in the financial system, any change program of this magnitude must be orderly and well-coordinated. This requires industry to establish a clear vision of the future target state, carefully weigh options for getting there, and incorporate end user needs and public interest considerations right from the outset.’
The RBA acknowledges the progress that industry has recently made towards meeting these recommendations. The RBA will provide ongoing oversight of transition activities, including by conducting assessments of industry’s implementation of these recommendations. The RBA will also actively support the modernisation of account-to-account payments by ensuring public interest considerations are reflected in industry deliberations over the strategic objectives for the account-to-account payments system.
While BECS has been in operation as a highly reliable system for more than 30 years, significant changes are needed to keep it fit for purpose. Furthermore, alternative payment rails, such as the NPP, potentially offer benefits for account-to-account payments. As a result, industry announced its intention to decommission the BECS framework in 2023, identifying June 2030 as the conditional target date.
In its 2023 Strategic Plan for Australia’s Payments System, the Commonwealth Treasury expressed its support for an industry-led, phased transition away from BECS. The Strategic Plan also noted the challenges that industry would need to address in migrating bulk payments made by business and government from BECS, and the need for large business and government users who have embedded BECS into their processes to be supported.
In her 2023 speech, the Governor Michele Bullock highlighted several significant challenges that will need to be addressed for the industry to successfully transition all BECS payments to more modern payment systems, acknowledging that the setting of a target end date by industry would assist in focusing industry attention, efforts, and planning.
The initial feedback which the RBA had received regarding the risk assessment was shared by Assistant Governor (Financial System) Brad Jones in his December 2024 speech, who stated that, among other things, ‘there has been insufficient industry coordination, planning and certainty regarding the transition’, and that ‘establishing a common vision of the features underpinning a desired end state will be essential if a program of this scale is to succeed’.
https://www.rba.gov.au/media-releases/2025/mr-25-06.html