These conventional crises could turn into a financial crisis in the payment system, which is a subject in itself. However, my speech today is limited to conventional vulnerabilities. RIX links together the banks and certain other financial agents so that they can quickly and simply make payments to one another, and it has a turnover of around SEK 500 billion a day. The problem with the Riksbank’s RIX system meant that a number of payments had been erroneously made several times over. This double entry meant that the banks had incorrect balances on their accounts in RIX, which created problems at the end of the day, as banks with a negative balance must borrow money overnight from those with a positive balance. This in turn entailed a disturbance in the functioning of the very important money market, that is, the market where the banks borrow money in the short term. When the error was detected the contingency routines were implemented, which meant that payments could be made without being entered more than once. The problem was due to an error in the communications system that links the banks to RIX. It took a total of five days to find the fault and implement a new solution. Nordbanken’s problems meant, amongst other things, that it was impossible to compile the bank’s normal background data for customer payments. Outwardly this was noticeable in that customers experienced problems using Nordbanken’s bank cards and through delayed payments.
However, it was possible to limit the damage since the system functioned from time to time and the contingency communications system was working. The problems were partly due to faulty software in the system. The problems began between Christmas and New Year 2000 and were not entirely resolved until 3 days into the new year. Afterwards, we can note that the consequences of these two problems were slight and that the existing contingency routines were sufficient to limit them. However, both examples show how important it is to have preparations that enable operations to continue, despite various types of disruption. The cost of creating an entirely resilient system must at the same time be balanced against the cost of having a slightly less resilient system and instead having good contingency routines that can be implemented when problems arise. I will return to the work on creating resilience in the system. Firstly, I shall describe how the financial infrastructure functions in practice and the importance of crisis recovery planning. The functions of the payment system To provide an idea of the extent and complexity of the payment system, I will give you a concrete example. The Swedish Social Insurance Administration pays out billions of kronor every month in  BIS Review 98/2006  1  pensions. In theory, it would seem like a fairly simple process for them to send money to Ingrid, aged 93.