The Riksbank announced that together with the European Central Bank (ECB) will explore the feasibility of using the Target Instant Payment Settlement (TIPS) platform to accommodate instant settlement of payments across European currencies, such as the Swedish krona and the euro.
„Providing cross-currency instant settlement services in central bank money under European governance could form an important contribution to the modernization of the European retail payments,” Riksbank said.
The Riksbank will introduce its RIX-INST service in May 2022. RIX-INST will provide financial institutions with instant settlement services in Swedish krona employing the TIPS platform. In its current adaptation, settlement on the TIPS platform is limited to transactions where the originator and beneficiary hold accounts in the same currency.
The Riksbank and the ECB will explore the feasibility of augmenting the TIPS platform to accommodate instant settlement of payments across European currencies, such as the Swedish krona and the euro.
The initiative is launched against the backdrop of growing demands for pan-European integration and ongoing work in the international community to address the paucity of fast, efficient and accessible cross-border payments.
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TIPS is a service that settles payments in central bank money in real time and around the clock. It currently supports the settlement of instant payments in euro, but also has the functional capability to support other currencies.
The project with Sweden’s central bank will begin this month with the first settlement of instant payments in Swedish kronor scheduled for May 2022.
In practical terms, a Swedish consumer would be able to transfer funds in kronor to a retailer in any euro area country, with the payment received in euro in a matter of seconds. A customer in the euro area could transfer euro in payment for goods in Sweden in the same way.
Other countries, with other currencies, that join the TIPS platform could also benefit from cross-currency instant payments.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
