The European Central Bank (ECB) welcomes the decision by Seðlabanki Íslands (Central Bank of Iceland) to begin a feasibility assessment to explore the possibility of joining the Eurosystem’s T2 real-time gross settlement system and its TARGET Instant Payment Settlement (TIPS) retail payment system.
By joining T2 and TIPS, market participants in Iceland will be able to settle payments in central bank money in both euro and Icelandic króna. On behalf of the Eurosystem, the ECB is ready to facilitate this process and continue working with Seðlabanki Íslands during the next steps in the feasibility assessment. The assessment will initially focus on TIPS, before looking at T2. The TARGET Services, which include T2 and TIPS as well as other services, are designed to promote a European payment landscape that is resilient, secure and efficient.
T2 is used for the settlement of large-value payments, while TIPS is used to process instant retail payments in real time around the clock, every day of the year. TIPS is designed as a multi-currency platform; currently it allows for the settlement of instant payments in euro and Swedish krona, while the Danish krone is being onboarded. Norges Bank has also expressed an interest in joining the system and adding the Norwegian kroner to the list of available currencies.