Swedish central bank signs agreement to join TIPS from 2022
The European Central Bank (ECB), the Eurosystem and the central bank of Sweden have partnered to offer Sweden access to the Eurosystem’s Target Instant Payment Settlement (TIPS) system.
TIPS aims to bring together fragmented EU payment systems
Electronic payments made in Swedish krona will be settled on the TIPS system, with the first batch set to be cleared under the new agreement in May 2022.
“In crisis times, this agreement is a good example of strong cooperation between central banks in Europe,” says ECB President Christine Lagarde.
“Our real-time settlement platform is a pivotal contribution to Europe’s endeavours to satisfy citizens’ increasing demand for faster, cheaper and convenient payment services without compromising on security.”
TIPS was developed as an extension of Target2 and settles payments in central bank money. The system was designed to reduce fragmentation in the EU and interoperate between multiple national payments solutions.
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TIPS offers final and irrevocable settlement of instant payments in euro, at any time of day and on any day of the year.
Participating payment service providers can set aside part of their liquidity on a dedicated account opened with their respective central bank, from which instant payments can be settled.
The price for each transaction is fixed at 0.20 cent (€0.002) until November 2020.The first 10 million payments made by each TIPS participant before the end of 2019 were free of charge.
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