A central point in the Swedish financial infrastructure
The customers’ deposit accounts form the basis of the banks’ payment systems. Customers can use these accounts to make the payments they need to make. The banks can in turn make payments via their accounts in the Riksbank’s payment system, RIX, which thereby constitutes a central hub in the Swedish financial infrastructure. The banks’ accounts with the Riksbank are used for both the direct payments between the banks and for the final settlement of payment orders from bank customers. This means that all payments involving a transfer from an account in one bank to an account in another bank are settled through the banks' accounts in RIX. This also applies to collective account-based retail payments such as salary payments. Payments relating to the trade in financial instruments, for example government bonds, are also settled in the RIX system.
Participants
Apart from the Riksbank, which owns and runs the system, all of the major banks and clearing organisations participate in RIX. The participants consist of 14 Swedish credit institutions, BGC, Euroclear Sweden, Nasdaq OMX DM, CLS, the National Debt Office and, as mentioned, the Riksbank. Participants in the RIX system can also make payments commissioned by other, mainly smaller, banks who are not themselves participants in the system.
Real-time gross settlement
The settlement of payments in the RIX system is based on the principle of real-time gross settlement, RTGS. This means that payments are settled immediately, one by one, on condition that the payer has sufficient liquid funds, that is money in his account. This settlement method entails low settlement risks but, on the other hand, requires considerable liquidity. If liquidity at the payer bank is insufficient, the payment is placed in a queue until such time as sufficient liquidity becomes available. In order to ensure the smooth settlement of payments, the banks are able to cover their liquidity requirements by borrowing intraday funds from the Riksbank. All such borrowing is fully secured.
Some payments are first netted with one of the clearing organisations BGC, Euroclear Sweden, Nasdaq OMX DM or CLS. Netting means that the payer and the payee offset their claims and liabilities against each other so that the payments are minimised to only one claim or one liability. Thereafter, only the remaining net sum is settled in RIX. The vast majority of all payments, however, are sent directly from the participants for settlement in RIX. Read more about BGC, Euroclear Sweden, Nasdaq OMX DM and CLS under the respective links in the menu on the left.
In 2008, the average number of transactions in RIX was approximately 7,974 per bank day and the average turnover per day was SEK 543 billion.
The Riksbank oversees the RIX system
The Riksbank has a responsibility to oversee all central parts of the payment system, including the RIX system. Part of this work includes regularly assessing the systems in terms of international standards. RIX 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. The Riksbank’s latest assessment was conducted in the autumn of 2007 and can be found under the link below.
For a more detailed description of the RIX system see the link The RIX Payment System below.