Tips and the future of instant payments
On 6 October, 2023, the Central Bank of Malta (the Bank), in collaboration with the European Central Bank (ECB) organised a national seminar on the TARGET Instant Payment Settlement (TIPS) and instant payments entitled ‘TIPS and The Future of Instant Payments’. The event was attended by the local credit and financial institutions. TIPS is a market infrastructure service launched by the Eurosystem in 2018.
The initiative is a pan-European system for processing instant payments in euros. It enables financial institutions to settle instantaneous electronic transfers, ensuring that funds are available to the recipient within 10 seconds, 24/7, 365 days a year.
The participants were addressed by Mr Dimitri Pattyn, Deputy Director General, Market Infrastructure & Payments, at the ECB and other officials from the same institution including Mr Fabrizio
Dinacci, Ms Panayiota Pentaliotou and Mr Bobby Bashford. They delivered presentations on the advantages of TIPS for the Maltese market, the main functionalities and operational aspects, pricing and onboarding process, respectively.
In his opening remarks, Mr Benoit Waelkens, Chief Officer Banking Operations, stated that “The instant payment is an innovative and revolutionary payment instrument that transformed the way we exchange value and conduct financial transactions in our increasingly digital world”. Furthermore, Mr Waelkens, outlined that both the ECB and the European Commission (EC) consider instant payments as a critical payment instrument in today’s
demanding world.
In his closing remarks, the Governor explained how the Commission decided to launch a legislative proposal on instant payments, on which trialogues are currently underway. Once this legislation is adopted, payment service providers which are currently reachable for SEPA Credit Transfers, through payment accounts, will be mandated to be reachable for instant payments within a stipulated time-frame.
Moreover, the Governor stip
ulated that the Bank stands ready to support and facilitate the adoption of instant payments which represent a transformative leap forward in the world of finance. However, this has to be done responsibly, ensuring that no one is left behind, stating that ‘’We must all work together to make this happen smoothly and to ensure that instant payment systems are robust, secure, and accessible to all, to shape the future of payments and drive economic growth and financial inclusion.’’