What does Bankgirocentralen do?
In Sweden, Bankgirocentralen, BGC, is the main intermediary of retail payments between the banks. BGC is owned by the banks and is responsible for running, administering and developing the bankgiro system. In addition, BGC manages certain payments originating from other systems than the bankgiro system.
The bankgiro system is an open one, which means that it can process transfers between all of the participating banks. The system is based on bankgiro numbers; each bankgiro number is not an account number but rather a type of address that points to a bank account. In 2008, 770 million payment transactions were mediated through the bankgiro system to a total value of SEK 9,356 billion.
The payments passing through the system may have been started in many different ways, for example over the counter of a bank branch or over the Internet. BGC also manages debit transactions, that is, those initiated by the payment recipient rather than the payment sender. This is the case with regard to direct debit payments, for instance. Other types of debit payments handled by BGC include cheque payments (including bank money orders) and card payments.
The Riksbank and BGC
As BGC has such a central position in the Swedish system for retail payments, the Riksbank oversees the system. Part of this oversight includes evaluating the BGC systems regularly in accordance with international standards. BGC is assessed in accordance with the Core Principles for Systemically Important Payment Systems, SIPS, adopted by the Committee on Payment and Settlement Systems, CPSS, at the Bank for International Settlement, BIS. Follow the links below to the most recent assessment and the international standards.
Read more about BGC on their website via the external link below.