The world is increasingly connected. Downtime has an instant impact on a business. Understanding the commercial and reputational impact associated with the loss of services is no longer optional. It can have an immediate commercial and reputational impact.
In critical business segments such as BFSI (Banking, Financial Services, and Insurance) there is an increasing trend by governments and regulators to ensure that businesses have business continuity and disaster recovery plans in place. This applies in almost all countries around the world. The main thrust behind this is to ensure market stability. If a firm has a disruption, it is important that the market is not affected and there is no so-called ‘systemic’ impact. The more important a firm is in any particular market, the more stringent the regulators are.
As an example of a service with systemic impact if not available, the Central Bank of Egypt (CBE), uses SWIFT Y Copy service for its Real Time Gross Settlement System (RTGS).
To illustrate the potential impact of a SIP failure, Figure 1 (shown right) shows the interconnections between the Bank of England and the 30 largest counterparties (Investment Banks). If any part of it fails, the impact on all the other parties can be significant.
The CBE and other central banks around the world are looking to ensure compliance with the internationally recognized BIS Systemically Important Payment Systems (SIPS) standards to mitigate any systemic risk.