Swedish Central Bank Urges Banks to Accelerate Cross-Currency Project Initiatives
The European Central Bank (ECB), the Riksbank, and Danmarks Nationalbank are collaborating on a groundbreaking initiative aimed at facilitating instant payments across different currencies, specifically the euro, Swedish kronor, and Danish kroner. This initiative is set to revolutionize the way international payments are processed, making them faster and more efficient.
Collaboration for Instant Payments
As part of this initiative, the Riksbank is actively inviting Swedish banks to engage in discussions about the design and testing of the TIPS (TARGET Instant Payment Settlement) cross-currency service. Per Jansson, the deputy governor of the Riksbank, emphasized the importance of this initiative:
“The Riksbank has long been working to make it easier to make payments between different currencies. In addition, the G20 has a global goal of making cross-currency payments more secure, more efficient, and cheaper. The work on TIPS cross-currency is an important step towards making this a reality but it also requires cooperation between central banks and the market.”
Future Developments in Cross-Currency Payments
Significantly, Norges Bank has plans to join the TIPS framework by 2028, which could potentially allow for payments in Norwegian kroner as well. Concurrently, the ECB is investigating options to connect TIPS with other international instant payment systems, thereby expanding its capabilities beyond Europe.
Invitation for Participation
The Riksbank encourages Swedish banks to express their interest in this collaboration by signing a Letter of Intent. The deadline for responses is set for February 28, 2025. This initiative not only aims to enhance payment efficiency but also promotes a collaborative approach among central banks and financial institutions.
Conclusion
In conclusion, the initiative spearheaded by the ECB, Riksbank, and Danmarks Nationalbank represents a significant advancement in the realm of cross-currency payments. The cooperation among central banks and market participants is vital for the successful implementation of this innovative service.
For further information on this topic, you can visit the European Central Bank website or check out the Riksbank’s official announcement.
