In November 2018, the Eurosystem launched TIPS (TARGET Instant Payment Settlement) to meet the growing demand for instant payments at the European level and to address the predominance of national solutions that have led to a fragmentation of payment services in Europe.
The TARGET instant payment settlement service allows payment service providers (PSPs) to transfer funds continuously and in real time, around the clock and every day of the year. This means that, thanks to TIPS, individuals and businesses can transfer money within seconds, regardless of the opening hours of PSPs. In order to promote the smooth and efficient operation of payment systems, the Eurosystem has expanded the scope of TARGET services to support the settlement of instant payments, offering pan-European accessibility and interoperability. Currently, TIPS settles payments in euro, Swedish kronor and Danish kroner. However, it can also support settlement in other currencies (the Norwegian and Icelandic communities are already preparing to join the TIPS platform). At the same time, the cross-border transaction service is being developed with the aim of settling cross-currency instant payments on the platform. This capability is a critical factor interconnecting TIPS with other instant payment systems for the settlement of cross-border payments outside the European Union.
TIPS is based on a modern payment system architecture that combines the advantages of a retail payment netting system and a real-time gross settlement (RTGS) system. Consequently, it is able to settle a large volume of payments instantly at a relatively low cost. Moreover, it is compliant with the Eurosystem’s strict oversight requirements for the resilience of financial market infrastructures against cyberattacks. Thus, it is capable of meeting the settlement requirements for a pan-European instant payment solution and of offering maximum protection against settlement risk, since transactions are executed in central bank money.
TIPS has achieved reachability throughout Europe, as it is based on the SCT Inst scheme and was developed as a service of the TARGET system, which already has a wide network of participants.
Pricing
The price structure for the TIPS service is applicable as of 1 January 2024.
- TIPS operates on a full cost-recovery and not-for-profit basis.
- There are no fees to join TIPS.
- The price per instant payment settled in TIPS is fixed at 0.2 cent (€0.002), which is shared equally between the sending participant and the receiving participant in TIPS (i.e. €0.001 for the originator and €0.001 for the beneficiary).
- In addition, monthly fees for holding the accounts on the platform apply to payment service providers and ancillary systems connected to TIPS.
- Transactions that are settled internally by an ancillary system are subject to degressive fees, i.e. a sliding scale, whereby the price per transaction falls as the monthly number of transactions rises.
Participation in TIPS
The TIPS onboarding procedure and all documents pertaining to potential TIPS participants-PSPs are included in the section “Participants”.
To initiate the onboarding procedure and submit the relevant documentation, please contact TIPS GR – Service desk.
For further information, please consult the respective presentations on TIPS and instant payments, which are available on the following link: Meetings of the Greek advisory group AMI-Pay GR-NSG.
