Target euro network misses the mark

Target, the European Central Bank's euro payment network, is showing signs of strain following last week's single currency launch.

The bank announced an extension to trading hours yesterday to cope with the high demand for euro transactions and delays in bank payments. Target will now close an hour later at 6pm until 29 January in order to help overcome teething problems.

The problems were blamed on several banks' failure to comply with Target's trading rules, and bottlenecks caused by a rush of trading at the end of the day.

Most banks have denied serious problems with the conversion to a single currency. However, a spokesman for Credit Suisse said he would have liked much more time for his bank to convert but had to "carry out the political will of the government".

The long-term future of euro conversion could be even bleaker, according to Jyoti Banerjee, MD of Tate Barnard Consultancy. Banerjee predicted worse disruption once companies in areas other than finance start to change their systems to cope with the euro. And he issued a stark warning to UK IT directors who, while not yet part of euroland, still have to prepare for the day when the euro comes.

"It is likely that if and when the UK signs up to the euro, it will have to do so at an accelerated timetable causing a massive rush for IT resources," said Banerjee.

Meanwhile, the UK government continues its 'wait and see' policy on EMU.