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Sweden has become the first non-euro area country to join the Eurosystem TARGET Instant Payment Settlement (TIPS) platform, allowing payment service providers to settle transactions in Swedish kronor.
Swedish market participants have been fully onboarded to TIPS since February 19, with 11 payment service providers having joined so far. They can transfer funds in central bank money between their Swedish kronor accounts in seconds.
The technical connection between Sveriges Riksbank’s real-time gross settlement system RIX-RTGS and the TIPS platform was established in May 2022.
TIPS is a European Central Bank (ECB) instant payment settlement system allowing participants to settle payments in central bank money around the clock, regardless of the opening hours of their bank. This enables payment service providers to offer European citizens and businesses fund transfers in real time on a 24/7 basis.
TIPS supports multiple currencies, and Sweden’s onboarding paves the way for other non-euro area countries that have also expressed interest, such as Denmark and Norway, to join.
The new connection allows payments with the Swedish person-to-person mobile payment service Swish to take place on TIPS using the single instructing party settlement model.
Swish has around 8.4m private users and 325,000 companies offer payments via the service.
Joining TIPS helps ensure EU member states comply with the regulation proposed in October 2022 and adopted by the Council of Europe on February 26, 2024 requiring payment service providers to offer instant payments to consumers and businesses in the EU and in EEA countries.
Under the rules, providers must give customers the option to transfer money within ten seconds around the clock, including to other EU member states.
Banks within the eurozone must be able to receive instant payments, ensure that fees are in line with regular credit transactions and have daily sanction screenings in place by December 2024.
Banks outside the eurozone, such as in Sweden, have 33 months to ensure instant payments can be received and 39 months to ensure instant payments can be sent, as well as ensuing payee verification can be carried out.
Payment institutions and e-money institutions have 36 months to ensure real-time transfers can be received and sent.
