The Analytics of Real-Time Gross-Settlement Systems

Marco Rossi
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Marco Rossi: International Monetary Fund

Chapter 2 in Payment Systems in the Financial Markets, 1998, pp 17-38 from Palgrave Macmillan

Abstract: Abstract A payment (or settlement) system can be seen as representing an example of a broad class of so-called ‘systems of flow’. A system of flow (payment system) is one in which a commodity (money) is transferred through one or more finite-capacity channels (the payment processing mechanism) in order to go from one point (payment system participant) to another. If the amount of payments and the time at which they arrive were exactly known and constant, the flow of payments would proceed in a predictable, reliable, smooth and trivial fashion provided that the mean capacity of the system, that is, the liquid funds available in the system, exceed the average payment flow requirement. Inevitably, real-world payment systems are stochastic as the amount and the arrival of payment orders are unpredictable.

Keywords: Arrival Rate; Payment System; Processing Cycle; Interarrival Time; Utilisation Factor (search for similar items in EconPapers)
Date: 1998
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DOI: 10.1007/978-1-349-26374-5_2

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