BGC

In Sweden, Bankgirocentralen (BGC) is the main intermediary of retail payments between the banks. BGC is owned by the banks.
 
BGC's system is an open one, which means that it can process transfers between all of the participating banks. The system is based on bank giro numbers, which are addresses to bank accounts. Notification and sorting of payment orders occurs centrally. Paper-based giro payments, which are mainly initiated by households, are processed by PrivatGirot, a separate company that functions as a pre-system to the Bankgiro system. Payments passing through the BGC system include giro payments, supplier payments, standard bank transfers, wage transfers and tax giros. The payment can be initiated by, for instance, a bank office, or over the Internet. BGC also manages debit transactions, i.e. those initiated by the payment recipient rather than the payment sender. This is the case with direct debits, for instance. Other types of debit transactions, such as cheque payments (including bank money orders) and card payments (both cash withdrawals and purchases) also pass through BGC's system.
 
Within the Bankgirot system more than SEK 14 billion, or over one million payment orders, are mediated every day. In 2004, SEK 4,587 billion, or 430 million payment transactions between suppliers and customers were made via Bankgirot. The majority of the transactions are settled as bilateral net transactions through participants' accounts in RIX. (RIX is the system that manages payments to and from the banks' accounts with the Riksbank). Only a small number of transactions, mainly cash withdrawal and card payments, are cleared and settled on a multilateral basis. At present there are predetermined settlement times, one or more for each type of transaction.
 
Previously, Postgirot was a system that competed with BGC. However, Postgirot was acquired by Nordea in December 2002 and now comprises an internal system for transfers between accounts in Nordea.
 
As Bankgirot has such a central position in the Swedish system for retail payments, the Riksbank oversees the functionality and risks in the system. Part of this oversight includes regular assessments of the system according to international standards. The first assessment was carried out in 2003. It was uppdated in December 2005. See the links below.
 
For further information on BGC, see the link to their website below.

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INTERNAL LINKS
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EXTERNAL LINKS
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LAST UPDATED 6/8/2006