Released on July 8 by the Committee on Payments and Market Infrastructures, the Report provides a framework to help payment system operators and authorities understand and evaluate the benefits, challenges and risks of interlinking arrangements. It also provides an overview of important trends in interlinking arrangements and the adoption of application programming interfaces by payment systems.
Some of the benefits outlined in the Report include the potential to enhance cross-border payments by shortening transaction chains, supporting the harmonisation of data formats, facilitating data exchanges through the use of dedicated applications and limiting redundant compliance checks.
The Report also outlined the risks of interlinking arrangements, including those related to the level of political support, possible high start-up costs as well as divergent legal, regulatory and oversight frameworks.
The Report stressed the importance of taking into considerations the legal, regulatory and oversight factors pertaining to interlinking arrangements and specific to each jurisdiction (e.g. service and security requirements…).