TARGET Instant Payment Settlement in the context of "T2 (settlement system)"

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⭐ Core Definition: TARGET Instant Payment Settlement

TARGET Instant Payment Settlement or TIPS is a TARGET Service of the Eurosystem that allows the settlement of instant payments in central bank money. The acronym TARGET stands for Trans-European Automated Real-time Gross-Settlement Express Transfer; other TARGET Services include T2 (RTGS) and TARGET2-Securities.

TIPS was introduced in November 2018 to respond to developments in the electronic payments market. As of late 2024, it settled payments in euros and Swedish kronas, with extensions planned to Danish krones and Norwegian krones.

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👉 TARGET Instant Payment Settlement in the context of T2 (settlement system)

T2 is a financial market infrastructure that provides real-time gross settlement (RTGS) of payments, mostly in euros. It is operated by the European Central Bank and is the critical payments infrastructure of the euro area. With turnover in the trillions of euros every day, it is one of the largest payment systems in the world. It is one of three so-called TARGET Services, together with TARGET2-Securities (T2S) for securities and TARGET Instant Payment Settlement (TIPS) for fast payments. The acronym TARGET stands for Trans-European Automated Real-time Gross-Settlement Express Transfer.

T2 replaced its predecessor RTGS system, TARGET2 (itself introduced in 2007-2008), on 20 March 2023.

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TARGET Instant Payment Settlement in the context of TARGET Services

TARGET Services (for Transeuropean Automated Real-time Gross-settlement Express Transfer) are payment services operated by the Eurosystem for the euro area and beyond on its proprietary financial market infrastructures.

As of late 2024, TARGET Services included T2 for large payments (which replaced TARGET2 in 2023), TARGET2-Securities (T2S) for securities transactions, and TARGET Instant Payment Settlement (TIPS) for instant payments. A fourth service, the Eurosystem Collateral Management System (ECMS), is to complement the TARGET suite in mid-June 2025.

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TARGET Instant Payment Settlement in the context of TARGET2-Securities

TARGET2-Securities, in shorthand T2S, is the Eurosystem's platform for securities settlement in central bank money. T2S offers centralised delivery-versus-payment (DvP) settlement across several European securities markets, without being itself a central securities depository (CSD) since it does not offer CSD services such as custody or asset servicing.

T2S is one of the Eurosystem's TARGET Services, together with T2 and TARGET Instant Payment Settlement (TIPS) for cash payments.

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LINKED FROM (PARENTS)
← T2 (settlement system) ← TARGET Services ← TARGET2-Securities
LINKS TO (CHILDREN)
TARGET Services → Eurosystem → Instant payment → Central bank money → T2 (RTGS) → TARGET2-Securities → Euro → Swedish krona → Danish krone → Norwegian krone →