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Cash & Liquidity Management
Published  5 MIN READ

Instant Payments and gpi: A Story of Interoperability

The payments sector has made huge strides in recent years. In Europe, the introduction of instant domestic payment services such as SCT Inst and TIPS has stoked demand for faster payments beyond Europe’s borders. While SWIFT gpi has moved us closer to meeting this demand, there is still work to be done – starting with the integration of gpi and the continent’s instant payments schemes, argues Cédric Derras, UniCredit’s Global Head of Cash Management.

Faster, more transparent cross-border settlement has long held a place near the top of European treasurers’ wish lists – and, slowly but surely, that wish is becoming reality. Recent improvements – most notably, the introduction and continued refinement of SWIFT’s global payments innovation (gpi) – have helped break down barriers to more seamless international payments, but there remains work to be done, with disparate time zones and limited clearing hours often delaying settlement.

The answer lies in combining the capabilities of gpi with domestic instant payments systems. Spearheaded by two robust instant clearing and settlement services, the real-time paradigm has taken off in Europe and, by harmonising these payments systems with gpi, there is scope to extend such service levels beyond European borders.

The rise of domestic instant payments

Perhaps the most talked about domestic instant payment system to emerge in Europe is the SEPA Instant Credit Transfer (SCT Inst). Devised by the European Payments Council (EPC), SCT Inst guarantees delivery of funds to any account within SEPA in under ten seconds. At the beginning of the year, SCT Inst had already been adopted by upwards of 2,000 payments service providers (PSPs) in more than 16 countries and is expected to reach critical mass by 2020.[1]