The Gross Electronic Payment System (EPS) The EPS Of

the gross electronic payment system (eps) the eps of the central bank is one of the crucial system of inter-bank payments, the implementatio

The Gross Electronic Payment System (EPS)
The EPS of the Central Bank is one of the crucial system of inter-bank
payments, the implementation of which in Armenian banks and bank
branches began in 1997. The owner and operator of the EPS is the
Central Bank, which also oversees and regulates the activity of the
system. It further formulates the system’s development policy and
ensures its implementation. The EPS operates on the real time gross
settlement (RTGS) regime, which means that the processing and final
settlement of payment orders (instructions) admitted to the system are
made separately, as per payment instruction/order. The flows of
payment messages in the system are V-structured.
The EPS is used only to make credit transfers, including commercial
banks’ own transfers on various financial liabilities, payments to the
budget, payments between business entities, private remittances of
citizens, etc.
The EPS does not provide the possibility of revoking or amending
payment orders (irrevocable payment orders). The EPS does not have
limitations on the transfer amount; the system may handle both
large-value and retail payments. Payment orders and other messages
(account statement, waiver to payment, etc.) in the system are
submitted in special formats developed by the Central Bank. The system
can be used for either single-payment orders or bulk transfers. It
also holds capacity for making foreign currency remittances.
The EPS operates in accordance with the following principles:
*
Settlements are made on a gross basis, as per payment order,
within the operational hours specified for the settlements;
*
Orders entered into the EPS are executed on a basis of sequence of
entries (a FIFO method of order execution);
*
The EPS presents only the same-day payments. Where a payment order
was submitted beyond operational hours for payment messages, it
shall be submitted to final settlement after the next operational
day is opened;
*
Final settlements are executed via correspondent (settlement)
accounts of the parties with the Central Bank, within the limits
of residuals of such accounts. The settlements made by the system
shall be treated as final and irrevocable after having been
executed via the Central Bank accounts;
*
There are no payment order queue management mechanisms in EPS:. If
funds in the relevant account for executing an order are not
sufficient, the order will be rejected without execution, while
the initiator will re-credit it to the EPS as a new order;
*
The payment order sent to the Central Bank by the
payer-participant will, after relevant checks, be automatically
transferred to the ‘Operational Day’ system where the final
settlement will be made, after relevant checks, by debiting the
monetary account of the payer-participant and crediting the
monetary account of the recipient-participant, after which a
message confirming the settlement will be sent to the
participant-beneficiary After having been credited to the account
of the participant-beneficiary, the settlement will be treated as
final and irrevocable, and the funds can be used by the
participant-beneficiary.