Vision for the future of financial market infrastructure

To pave the way for greater European market integration the Eurosystem has a vision for the future financial market infrastructure. The key objective is to improve efficiency and use innovation to continuously enhance Europe’s financial market infrastructure in line with the latest technological developments and with the needs and requirements of the market. To achieve this, the Eurosystem is working closely with market participants to explore and investigate opportunities. The three pillars of the vision are:

  • Future real-time gross settlement services arising from T2S;
  • instant payments processing; and
  • common Eurosystem collateral management system.

Future real-time gross settlement services arising from T2S

The aim here is to consolidate the technical and functional aspects of real-time gross settlement services (RTGS) to bring benefits to TARGET2 end-users by using the state-of-the-art features offered by T2S. The Eurosystem is therefore evaluating whether TARGET2 should offer new services in response to market demands.

Instant payments processing

Another goal is to ensure that the clearing and settlement infrastructure supports the instant SEPA credit transfer scheme – SCTinst – that is being developed by the European Payments Council. Consequently, any payment service provider that makes payments based on the scheme should be reachable at pan-European level irrespective of the infrastructure used.

The Eurosystem will discuss with market participants how better to support the settlement of instant payments.

Settlement of instant payments

Common Eurosystem collateral management system

Further harmonisation of the Eurosystem’s collateralisation techniques and procedures is another goal. The business case for a common Eurosystem collateral management system will be considered once further harmonisation is reached.

Current projects

Secured Financing Transactions Data Store project

The European System of Central Banks (ESCB) has launched a project to build a data store for secured financing transactions (SFTs). The aim is to enable central banks in the EU, and possibly EU regulators, to obtain, store and analyse SFT data as of 2018. The data store will increase transparency in the SFT market and give EU authorities an additional tool to prevent financial stability risks and monitor global trends.

Secured financing transactions

Next steps

The Eurosystem will continue to work in close collaboration with market participants to ensure that specific market needs and areas for improvement are identified.

The first consultation on future RTGS services was launched on 15 February 2016.

Further discussion with market participants is taking place at events held across Europe.