This report takes stock of recent developments in retail fast payment systems (FPS), examines central banks' roles in these systems and discusses the implications for real-time gross settlement (RTGS) systems which provide a critical foundation for the wholesale settlement associated with FPS.
Global adoption of retail FPS is rising at a rapid pace with some
convergence in features and design. The report finds that a growing
number of FPS have adopted – or are moving towards adoption of – the ISO
20022 messaging format. FPS are also increasingly settling obligations
among banks and, where relevant, non-bank FPS participants on a
payment-by-payment basis in real time. In terms of the role of the
central bank in an FPS, while differences in approaches remain, central
banks tend to play important roles in facilitating the operations of
FPS; in a number of cases, they also operate the FPS system.
Designing, implementing and operating an FPS is complex. Challenges
include ensuring high system availability and reliability requirements.
FPS can also have significant implications for the operations and
services of RTGS systems in the jurisdiction. This can include potential
modifications to access criteria and extension of operating hours at
the RTGS system. The insights from this study can be relevant for
jurisdictions considering implementing a new FPS, or modifying an
existing arrangement.
Full paper
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