Interbank instant payments will not be made on Thursday night

Postitatud:

08.12.2021

The interbank instant payment service will temporarily be unavailable on the night of Thursday to Friday. The outage will last from 01.30 to 08.00 on Friday and any instant payments made at this time will reach the payee on Friday morning from 09.00.

The interruption will allow important work to be done so that instant payments can start to be transferred between two different European instant payment systems. The change will allow clients of Estonian banks to send and receive instant payments with more banks in Europe in future.

“There are currently several different instant payment systems in Europe, and they do not communicate between themselves very well. There are in effect various instant payment islands in Europe, where payments can move around each island but not between islands. It is planned to link the instant payment islands together in three waves. The first wave of linking will be done on Friday and will affect the clients of banks in Estonia”, said Rainer Olt, head of the Eesti Pank payment and settlement systems department.

Interbank payments in Europe and Estonia generally move either as ordinary payments or as instant payments. Instant payments are completed immediately and around the clock, while ordinary pavements are only completed five times a day. Ordinary payments are not sent in the evenings, at night, at weekends or on holidays. Up to 100,000 euros can be sent as a single instant payment.

Mr Olt said that the banks in Estonia are at the forefront of instant payments in Europe, as the share of payments in Estonia that are instant payments is much larger than the average share in Europe, and the banks in Estonia do not charge any additional fee for instant payments on top of what they charge for ordinary payments. In November, 70% of the interbank payments made in Estonia were instant payments, while the most recent data for the euro area show that only 10% of interbank payments were instant payments.

The five banks in Estonia that currently use instant payments are SEB, LHV, Swedbank, Coop and Citadele, and their interbank payments account for 95% of all the interbank payments made in Estonia. The banks in Estonia use the ordinary payments system for payments that are not time critical and for which the payment deadline is already known, such as standing orders or e-invoice standing orders.

Background

During the outage on Thursday night and Friday morning, a connection will be made for the RT1 payment system to TIPS (TARGET Instant Payment Settlement), which is the other payment system designed for instant payments. The RT1 system uses the EBA Clearing clearing house that the banks in Estonia use for interbank payments. The TIPS payment system is managed by the central banks of the euro area.

The various clearing houses in Europe will be connected for instant payments in several stages, and EBA Clearing is joining TIPS in the first wave this week.

Banks offer the option of express payments alongside ordinary payments and instant payments, and these are intended principally for sending very large sums of money immediately during normal business hours. This service is notably more expensive however, and payments cannot be made through it in the evening, at night or on non-working days.

Payment systems in Estonia: https://www.eestipank.ee/en/payments/payment-and-settlement-systems

EBA Clearing: https://www.ebaclearing.eu/about-eba-clearing/at-a-glance/the-company/

TIPS: https://www.ecb.europa.eu/paym/target/tips/html/index.en.html

Additional information:
Viljar Rääsk
Head of Communications
Eesti Pank
6680 745, 5275 055
Email: viljar.raask@eestipank.ee
Press enquiries: press@eestipank.ee