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Cross-Currency Settlement of Instant Payments in a Cross-Platform Context: a Proof of Concept

Author

Listed:
  • Massimiliano Renzetti

    (Banca d'Italia)

  • Andrea Dimartina

    (Banca d'Italia)

  • Riccardo Mancini

    (Banca d'Italia)

  • Giovanni Maria Sabelli

    (Banca d'Italia)

  • Francesco Di Stasio

    (Banca d'Italia)

  • Carlo Palmers

    (SWIFT)

  • Faisal Alhijawi

    (Buna Payment Platform)

  • Erol Kaya

    (Buna Payment Platform)

  • Christophe Piccarelle

    (DXC Technology)

  • Stuart Butler

    (DXC Technology)

  • Jwallant Vasani

    (Jordan Ahli Bank)

  • Giancarlo Esposito

    (Intesa Sanpaolo)

  • Alberto Tiberino

    (Intesa Sanpaolo)

  • Manfredi Caracausi

    (Intesa Sanpaolo)

Abstract

This paper presents the results of a joint experiment involving Banca d’Italia and the Arab Regional Payments Clearing and Settlement Organization (ARPSCO), focusing on the settlement of cross‑currency instant payments across different technical platforms. TIPS and Buna are the instant payment settlement platforms with multi-currency features operated by the two organizations respectively. Both platforms started with an initial investigative phase, in order to assess operational policies and the legal and technical implications of implementing a cross‑currency instant payment settlement service, i.e. one in which the debtor and creditor accounts are denominated in two different currencies both eligible for settlement on the platform. For the purpose of the Proof of Concept (PoC), two representatives of the abovementioned market communities, namely Intesa Sanpaolo and Jordan Ahli Bank, participated in their respective capacities of Originator PSP and ultimate Beneficiary PSP for the corresponding currencies, i.e. the euro and the Jordanian dinar. In line with building blocks 13 and 17 of the G20 global roadmap for enhancing cross-border payments (concerning the interlinking of payment systems), the natural evolution of these investigations was to explore possible options for providing the same type of cross-currency service in a cross-platform scenario, i.e. through the interoperability of different instant payment platforms. The PoC described in this paper relates to the implementation of a cross-platform scenario involving TIPS and Buna.

Suggested Citation

  • Massimiliano Renzetti & Andrea Dimartina & Riccardo Mancini & Giovanni Maria Sabelli & Francesco Di Stasio & Carlo Palmers & Faisal Alhijawi & Erol Kaya & Christophe Piccarelle & Stuart Butler & Jwall, 2022. "Cross-Currency Settlement of Instant Payments in a Cross-Platform Context: a Proof of Concept," Mercati, infrastrutture, sistemi di pagamento (Markets, Infrastructures, Payment Systems) 19, Bank of Italy, Directorate General for Markets and Payment System.
    • Handle: RePEc:bdi:wpmisp:mip_019_22
    as

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    File URL: https://www.bancaditalia.it/pubblicazioni/mercati-infrastrutture-e-sistemi-di-pagamento/approfondimenti/2022-019/N.19-MISP.pdf
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    References listed on IDEAS

    as
    1. Cristina Mastropasqua & Alessandro Intonti & Michael Jennings & Clara Mandolini & Massimo Maniero & Stefano Vespucci, 2021. "T2S - TARGET2-Securities - The Pan-European Platform for the Settlement of Securities in Central Bank Money," Mercati, infrastrutture, sistemi di pagamento (Markets, Infrastructures, Payment Systems) 4, Bank of Italy, Directorate General for Markets and Payment System.
    2. Mauro Arcese & Domenico Di Giulio & Vitangelo Lasorella, 2021. "Real-time Gross Settlement Systems: Breaking the wall of scalability and high availability," Mercati, infrastrutture, sistemi di pagamento (Markets, Infrastructures, Payment Systems) 2, Bank of Italy, Directorate General for Markets and Payment System.
    3. Massimiliano Renzetti & Serena Bernardini & Giuseppe Marino & Luca Mibelli & Laura Ricciardi & Giovanni Maria Sabelli, 2021. "TIPS - TARGET Instant Payment Settlement The Pan-European Infrastructure for the Settlement of Instant Payments," Mercati, infrastrutture, sistemi di pagamento (Markets, Infrastructures, Payment Systems) 1, Bank of Italy, Directorate General for Markets and Payment System.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Payment Systems; Instant Payments; Market Infrastructures; Cross-Border Payments.;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System

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