Fintech
BSP fully automates intraday settlement function to improve transaction efficiency
The Bangko Sentral ng Pilipinas (BSP) has fully automated the Intraday Settlement Facility (ISF) for financial institutions, aiming to speed up transactions and resolve timing discrepancies.
This digital advancement was made in collaboration with the Bureau of the Treasury (BTr) and aims to improve the efficiency of the peso Real-Time Gross Settlement (RTGS) payment system operated by the BSP.
The central bank and the Bureau of the Treasury launched the fully automated ISF last month, making it available to all eligible financial institutions that are facing timing inconsistencies in settling transactions through the BSP-operated Real-Time Gross Settlement (RTGS) peso payment system.
This new structure connects BSP RTGS System, PhilPaSSpluswith the enhanced National Register of Non-Deposit Securities of BTr, thus preventing inconsistencies and ensuring timely payments to banks for securities sold to the central bank.
The BSPdeclared that the full automation of the Intraday Settlement Facility is in line with their mandate to promote a “safe, efficient and reliable way of transferring funds in support of financial stability”.
The integration of this feature allows PhilPaSSplus participants to receive funds within minutes of initiating a repurchase agreement or repurchase transaction with the BSP, enabling them to fulfill queued or scheduled outgoing payment instructions in PhilPaSSplus.
PhilPaSSplus, the country’s only peso-denominated RTGS system, facilitates efficient and low-risk settlement of large-value fund transfers between financial institutions.
It also clears retail payments made by individuals, businesses and the government via checks, debit cards, Immediate paymentAND PESONet.
The peso RTGS payment system has been designated as a systemically important payment system (SIPS) that presents, or has the potential to present, systemic risk, threatening the stability of the national payment system.
Accordingly, system participants must comply with BSP rules, standards and requirements, contributing to the safety, efficiency and reliability of the payment system.