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12 Key Standards and Self Assessments- Code 8

8. Core Principles for Systemically Important Payment Systems

Description | Standard | Self-Assessment

Payment systems are an essential mechanism supporting the effectiveness of financial markets. A properly functioning payments system facilitates prompt and secure settlement of securities and other transactions and contributes to the reduction or elimination of principal risk. Disruption in the payment systems could threaten the stability of money markets and of other domestic and international financial markets. Likewise, disruption in the securities settlement systems could result in a serious liquidity pressure in the market and spill over to payment systems. Robust payments and settlement systems are, therefore, a key requirement in maintaining and promoting financial stability.

A set of ten core principles, and four responsibilities of central banks in applying them have been developed for the payment systems.

Last Updated: 12/1/2010 8:31 AM