The ability of participants to reach each other is a crucial element for the success of a payment scheme. Although many banks have been adhering to the EPC’s SEPA Instant Credit Transfer scheme (SCT Inst scheme) in the three years since it was launched, they have not been able to exchange payments in every case. The main reasons for this are that banks participate in different clearing systems which, in some cases, have a purely national focus, and that not all of these clearing systems are interconnected.
In July 2020, the ECB Governing Council therefore decided on a package of measures to ensure – via the Eurosystem’s range of services – the pan-European reachability of all payment service providers that have adhered to the SCT Inst scheme.
What decision has the ECB Governing Council taken?
The measures decided on by the ECB Governing Council on 29 July 2020 are intended to ensure the pan-European reachability of all scheme participants:
- by requiring all payment service providers that have adhered to the SCT Inst scheme and are reachable in TARGET2 to also become reachable in TIPS from November 2021 at the latest;
- by transferring the technical accounts of all clearing systems that settle SCT Inst payments from TARGET2 to TIPS.
As a result, clearing systems will be connected via the TIPS platform and their participants will be able to exchange SCT Inst payments. In addition, this shift to TIPS has the advantage that the cover amounts required to settle payments in clearing systems can be transferred from the participants’ TIPS accounts to clearing systems’ technical accounts around the clock (24/7). At the moment, this is only possible during TARGET2 operating times.