Systemically Important Payment System: Difference between revisions

Revision as of 21:43, 25 December 2024

Latest revision as of 17:20, 14 February 2025

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{{Short description|Designation for financial payment systems}}

A '''Systemically Important Payment System''' ('''SIPS''') is a [[payment system]]s whose failure could potentially endanger the operation of the whole economy. In general, these are the major payment clearing systems or [[real-time gross settlement]] systems of individual countries, but in the case of Europe, there are certain pan-European payment systems. As of late 2023, the [[T2European (RTGS)|T2Central Bank]] ishad adesignated pan-Europeanfive payment systems as SIPS, dealingnamely with[[T2 major(settlement inter-banksystem)|T2]], payments.[[EURO1]], [[STEP2]], operated[[STET-CORE|CORE(FR)]], by theand [[Euro BankingMastercard AssociationEurope]],.<ref>{{cite isweb a|website=International majorMonetary panFund |date={{date|2023-European9-8}} clearing|url=https://www.imf.org/en/Publications/CR/Issues/2023/12/07/Belgium-Financial-Sector-Assessment-Program-Detailed-Assessment-of-Observance-Assessment-of-542179 system|title=Belgium: forFinancial retailSector paymentsAssessment whichProgram-Detailed hasAssessment of Observance-Assessment of the potentialCPSS–IOSCO toPrinciples becomefor aFinancial SIPS.Market Infrastructures Euroclear Bank}}</ref>{{rp|12}}

In the event of a bank failure, adherence to the rules for the operation of SIPS should prevent a domino effect whereby payment obligations of the failing bank are effected against the solvent banks. Clearly, this does not prevent the effects of a bank failure from spreading; however, it closes off one route.