Large value payment systems: principles and recent and future developments

The present European large-value payment systems are on the verge of notable changes. Since they comprise the backbone or basic infrastructure of the whole economy, it is important that the changes are monitored and carried out in a very prudent manner. This paper attempts to analyse this change and provide an understanding of where we stand today and outline some possible prospects. The large-value payment systems are described and analysed in general terms. For the sake of comparison some important large-value payment systems outside of Europe are also examined. <p> It seems that there will be significant changes in the payment systems industry in the near future. Options for many areas are still open but some trends are visible. These trends are: economic integration, increasing pressure from the EU and the regulators to form a single domestic market across the whole EU area, rapidly changing regulatory environment, rapid development of IT, outsourcing of the payment system value chain, increasing emphasis on customer point of view and efficiency. Furthermore, the border line between large- and small value payments could become blurred, TARGET2 brings considerable changes to the present situation, the scope of CLS should be extended, SWIFT system will become industry standard both in cross-border and domestic payments. These developments in the EU might mean, from the Finnish point of view, that the development in several places could go backwards.