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In addition to the TARGET payment system, which unites several European countries into a single RTGS network, there are several other private payment systems in the eurozone that carry out cross-border transfers. One of these systems is EUR01. It was founded by a group of large European banks under the auspices of the European Banking Association (EBA).
EUR01 members exchange payment messages using SWIFT networks. Based on these messages, EUROl calculates in real time the mutual positions of the members of this organization and controls their liquidity. Each participant is set a limit that cannot be exceeded during the day. At the end of the day, banks with debit positions pay off their debt through the RTGS of their TARGET participating countries. The amounts are transferred to the EUR01 account with the European Central Bank, from where these amounts are transferred to the accounts of participants with credit balances at the end of the day. The peculiarity of settlements through EUR01 is that the system at each moment of the trading day calculates the net position of each participant in relation to all other members of the system. The position changes in real time with each new receipt of funds or payment.
To reduce risks, banks set credit limits in relation to each counterparty. EUR01 calculates two general credit limits:
To ensure successful settlement at the end of the day, the European Central Bank has a liquidity pool of € 1 billion, with all banks contributing their share.
The total amount of payments in EUR01 ranges from 180-215 billion euros per day.
EUR01 members exchange payment messages using SWIFT networks. Based on these messages, EUROl calculates in real time the mutual positions of the members of this organization and controls their liquidity. Each participant is set a limit that cannot be exceeded during the day. At the end of the day, banks with debit positions pay off their debt through the RTGS of their TARGET participating countries. The amounts are transferred to the EUR01 account with the European Central Bank, from where these amounts are transferred to the accounts of participants with credit balances at the end of the day. The peculiarity of settlements through EUR01 is that the system at each moment of the trading day calculates the net position of each participant in relation to all other members of the system. The position changes in real time with each new receipt of funds or payment.
To reduce risks, banks set credit limits in relation to each counterparty. EUR01 calculates two general credit limits:
- 1) the amount of the participant's credit limits to all other participants;
- 2) the amount of credit limits of all participants in relation to this participant.
To ensure successful settlement at the end of the day, the European Central Bank has a liquidity pool of € 1 billion, with all banks contributing their share.
The total amount of payments in EUR01 ranges from 180-215 billion euros per day.
