CBR enhances payment system for seamless market settlements

The Bank of Russia has introduced a new functionality within its payment system, enabling direct and seamless settlement of financial market transactions.

This enhancement specifically targets deposit and repo transactions executed on the Moscow Exchange and the Saint-Petersburg Currency Exchange, with clearing services provided by the National Settlement Depository.

Previously, the settlement of similar repo transactions involved a more complex process where the National Settlement Depository handled the settlements.

This often necessitated transaction participants to transfer portions of their funds from their correspondent accounts held with the Bank of Russia, adding an extra layer of operational complexity and potential delays.

The new tool streamlines this entire process by allowing payments to be settled directly within the Bank of Russia Payment System immediately following their clearing, thereby integrating the clearing and settlement phases more tightly and reducing reliance on multi-step fund transfers.

This operational upgrade is designed to deliver substantial benefits to both participating banks and the Federal Treasury.

By facilitating direct settlements, the new service significantly improves the efficiency of liquidity utilization, allowing market participants to manage their funds with greater flexibility.

It also contributes to a notable reduction in operating expenses, as the need for intermediary fund transfers and associated administrative tasks is minimized.

Furthermore, the streamlined process is expected to drastically reduce the possibility of settlement delays and the occurrence of outstanding settlements, thereby enhancing overall market stability and operational reliability.

This move aligns with global trends towards more robust and efficient financial market infrastructures.