Beruflich Dokumente
Kultur Dokumente
SETTLEMENT SYSTEM
(REPSS)
By J. BOSCO SEBABI
Director
Payment Systems Department
National Bank of Rwanda
Cape Town
April 2009
Content
Background
COMESA Clearing House
The Regional Payments and Settlement System
(REPSS)
REPSS main features
Roles and responsibilities of Participants
The Advantages
The Challenges
Background
1981 - TREATY ESTABLISHING PTA SIGNED.
1982 – PTA TREATY, WHICH ENVISIONED ITS
TRANSFORMATION INTO A COMMON
MARKET IN 10 YEARS RATIFIED.
1993 – TREATY ESTABLISHING COMESA SIGNED
1994 – COMESA TREATY RATIFIED
2000 – FREE TRADE AREA (FTA)
2009 – LAUNCH OF CUSTOMS UNION
COMESA Membership
Burundi, Malawi,
Comoros Mauritius,
Democratic Republic of Rwanda,
Congo Seychelles,
Egypt, Sudan,
Eritrea, Swaziland,
Ethiopia, Uganda,
Kenya, Zambia,
Libya, Zimbabwe
Madagascar
COMESA Objectives
Attainment of sustainable growth and development for
its Member States
Promotion of joint development in all fields of
economic activity
Creation of an enabling environment for foreign, cross
border and domestic investment
Promotion of peace, security and stability among its
Member States
COMESA in a Nutshell
TOTAL AREA 12.8MILLION SQ. KM
POPULATION 380 MILLION
MEMBERSHIP 20 COUNTRIES
FTA MEMBERSHIP 13 COUNTRIES
GDP AT CURRENT PRICES $180 BILLION
PER CAPITA GDP $600
INTRA-COMESA TRADE $ 7.5 BILLION
EXTERNAL DEBT $130 BILLION
COMESA Institutions
COMESA Trade and Development Bank (PTA Bank )
COMESA Clearing House (CCH)
COMESA Leather and Leather Products Institute in
Ethiopia
COMESA Re-Insurance Company (ZEP-RE)
COMESA Court of Justice in Khartoum
African Trade Insurance Agency
COMESA Clearing House (CCH)
• COMESA Clearing House (CCH) was established in
1984 (as the PTA Clearing House) to facilitate the
payment and settlement of cross border payments
amongst COMESA States
CCH Cont…
objectives
Establishment of adequate machinery for the settlement of
payments among Member States
Saving on the use of foreign exchange by the Member
States in their inter-state transactions
Supporting Member States in liberalisation of trade
through appropriate facilitation instruments
Promotion of monetary and financial co-operation among
Member States and closer relations among banks
throughout the COMESA region
The Regional Payment and
Settlement System
Principles
SETTLEMENT OF TRANSACTION AT SPOT
T+0 VALUE T+2 (with possibility of T+0)
AGREED SPOT EXCHANGE RATE (MID-RATE)
DOMESTIC RTGS/NPS SYSTEM
SINGLE CURRENCY NET SETTLEMENT (USD/EURO)
SINGLE NOSTRO CORRESPONDENT
Principles Cont…
COMESA CLEARING HOUSE (CCH) WILL ACT AS AGENT ON
BEHALF OF CENTRAL BANKS
SECURITY AND OPERATIONAL RELIABILITY
CONTINGENCY PLANNING (BRP/DRP)
NO RISK ACCRUING TO CENTRAL BANKS
AUTONOMY OF COMESA CLEARING HOUSE
REPPS FEATURES
IMPORTER EXPORTER
CENTRAL CENTRAL
(4) (6)
BANK A BANK B
(5)
(9) (8) COMESA (8)
CLEARING CENTRAL
CENTRAL
HOUSE BANK B
BANK A
USD/EUR NOSTRO
USD/EUR NOSTRO
(11) BANK OF MAURITIUS
BANK OF MAURITIUS
COMESA
(10) CLEARING HOUSE (12)
USD/EUR NOSTRO
BANK OF MAURITIUS
Advantages of REPPS
REDUCTION IN FOREIGN FUNDING
REDUCTION IN SETTLEMENT
TRANSACTIONS
REDUCTION IN FOREIGN CORRESPONDENT
BANKING CHARGES
REDUCTION IN SETTLEMENT TIME PERIOD
SETTLEMENT FINALITY
REDUCTION IN COLLATERAL
REQUIREMENTS
The Roles of Participants
CCH will ensure that:
Each participating Central Bank’s exchange rate is
received;
There is sufficient funds under the respective limits for
the Central Banks (Importer/Exporter) prior to
processing the transaction
Confirmation of successful payments will be advised to
the paying Central Banks
Notification of incoming payments will be made to the
receiving Central Banks
CCH Roles Cont…
All Central Banks are advised of the EOD positions on
their account in REPSS;
All discrepancies that may arise with a Central Bank
are resolved;
Confirmation of the EOD position from all Central
Banks are received prior to initiating the EOD
settlement process;
CCH Roles Cont…
If it is a net payer, an instruction is issued to the
Settlement Bank by CCH to effect payment of the net
balance to the account of the receiving Central Bank
for value T+2 or as otherwise specified. If a net
receiver, CCH will advise the Settlement Bank to
receive payment from the paying Central Bank for the
credit of CCH account;
All queries arising from participants are attended to.
Roles Cont..
The Central Bank will ensure that:
They advise CCH of their exchange rate against the
USD & Euro within the set time frame;
Funds are available in the Commercial Bank
account (importer) prior to processing the
transaction;
Central Bank roles Cont…
If funds have been pushed through in local
currency via NPS, it will converted to USD/Euro
for onward processing on to REPSS. Transaction
will be processed on T+0 for value T+2 or as
otherwise specified;
There are sufficient funds under their respective
limits at CCH prior to submitting the payment
instruction;
Central Bank roles Cont…
Confirmation of the successful transaction is advised
to the Commercial Bank. If not successful, an advice is
also sent to the Commercial Bank;
On receipt of funds from CCH, it is converted to the
local currency for the credit of the Commercial Bank;
EOD position as reflected in their records agrees with
the one in REPSS as advised by CCH. Any discrepancy
is investigated with the CCH immediately;
Central Bank roles Cont…
A confirmation is sent to the CCH once the EOD position is
agreed;
They receive advice that EOD settlement process has been
initiated from the CCH;
If a net payer, they advise the Settlement Bank to effect
payment of the net balance for the credit of CCH account
for value T+2 or as otherwise specified;
Central Bank roles Cont…
If a net receiver, they advise the settlement bank to
receive payment of the net balance from the CCH
for the credit of their account for value T+2 or as
otherwise specified;
Their account held at the Settlement Bank is
adequately funded prior to effecting settlement in
favour of the CCH;
Roles Cont…
Commercial Banks will ensure that:
LCs are drawn either in the currency of the exporter or
in USD or Euro and that settlement is effected over
REPSS;
They use the agreed daily exchange rate, obtained
from CCH from their Central Bank to convert the LC
currency to their (Importers) currency if payment is
over the NPS or other currency as may have been
agreed upon between the importer and the exporter;
Commercial Banks Cont…
Sufficient funds are available on their settlement
account maintained at their Central Bank ;
The transaction is processed on T+0 for value T+2 or as
otherwise specified;
On receipt of incoming funds from the Central Bank,
they verify the details against the LC and advise the
exporter accordingly;
They update their liquidity management system in
respect of payments effected and funds received
through their Central Bank.
The Challenges
• Absence of RTGS in some countries
• Different levels of Payment Systems advancement
• Recruitment of commercial banks into the project
• Legal and regulatory issues
THANK YOU VERY MUCH FOR
YOUR ATTENTION