Real Time Gross Settlement (RTGS)
Provides irrevocable clearing and settlement of financial transactions between Central Banks and Participants efficiently and reliably…
The need for a new domestic payment infrastructure
The global economy depends on a highly sophisticated banking system to make payments and settle transactions. The Bank for International Settlements (BIS) established Real‐Time‐Gross‐Settlement (RTGS) as the standard for large‐value interbank funds transfers to improve efficiency and reduce risk. However, the gulf between the implementation of an improved international standard and the ability of all countries to meet that standard can be a formidable one.
A modern, efficient and reliable payments infrastructure is now an essential requirement for any country looking to promote growing financial markets and improve execution of monetary policy. A country must be capable of clearing and settling a wide range of transactions according to international standards if it is to be successful in attracting foreign investments.
In the past, the requirements and investments associated with implementing a comprehensive RTGS system has made it difficult for many countries to justify cost. The Montran solutions have changed that with functionally rich, reliable, secure, cost effective systems.
The Montran RTGS Solution
The Montran RTGS is specifically designed to meet and exceed the standard required by today’s Central Banks for Real-Time-Gross-Settlement processing. The Montran RTGS solution handles very high volumes of large-value domestic payments and combines efficiency and reliability of service with sound position maintenance and intraday liquidity management facilities.
The solution is based on modern web technology, using Java Enterprise architecture and components combined with RDBMS and PKI based security. The open architecture and the open standards simplify integration with other financial systems. Since the system is Java based, it can run on a wide choice of hardware, operating systems and databases, and can be implemented, maintained and when necessary enhanced with efficiency. The software architecture allows for maximum hardware platform independence that benefits the overall RTGS solution from both a cost and a reliability perspective.
Increased Efficiency
The modern architecture and flexible tools of the Montran RTGS solution makes it easier to optimize the cash flows, to enable flexible STP and to enhance liquidity management facilities necessary for the oversight and execution of monetary policy. The solution’s electronic delivery mechanism ensures secure delivery of payment orders to the central system and manages the queuing and delivery of payments and confirmations to the participants.
Risk Management
The Montran RTGS system is designed to maximize the use of liquidity in settling interbank transactions while at the same time reducing the risk between the origination of payment instruction and its final execution. The settlement process is always final and irrevocable and the involved Participants have immediate access to the settled funds. For more elaborate settlement arrangements we fully support Delivery-versus-Payment (DvP) and Payment-versus-Payment (PvP) options with other external financial systems.
The Montran RTGS system offers a complete Anti Money Laundering (AML) system for the identification and blocking of transactions involving parties found on OFAC – Office of Foreign Asset Control, Global Watch Lists, LAC – Local Asset Control, European and other country AML Lists.
Features
Modules- Security
Features of the Montran RTGS
- A modular component structure to meet individual country requirements and for flexibility in growth and expansion as needs arise.
- Final and irrevocable settlement of funds transfers continuously in real‐time
- Centrally located queuing of payments that are held awaiting availability of funds
- Automatic gridlock resolution
- Complete monitoring of account balances for both the Central Bank and participating institutions
- Credit and intra‐day liquidity management facilities
- Maintenance of a statistical database with query and reporting facilities
- Payment entry and processing using standard SWIFT message formats
- A multi‐currency and multi‐lingual system
- Secure payment and message transmission using the SWIFT services and secure interactive communication for monitoring and queue management
- Operational reliability with backup and contingency arrangements
- Complete audit trail, recovery and reporting facility
Core Modules
- Central RTGS Engine – the highly optimized and efficient core settlement EJB3 application running on clustered servers for maximum performance and reliability.
- Central Payment Originator System – the centrally running server application with a thin-client architecture that provides users with the ability to manually enter all payment message types, SWIFT or non-SWIFT. It features on screen data validation, SSL encryption, digital signatures and compatibility with most Internet browsers available on the market.
- The RTGS Webstation – it provides access to the web interface of the Montran RTGS solution via a standard Internet browser, a VPN connection to the central system and a cryptografy kit. The webstation requires no locally installed Montran software, hence reducing the maintenance costs to zero for the connecting Participants.
- The RTGS Gateway – the most cost effective solution for achieving maximum STP capabilities with external systems feeding payments to the RTGS. Featuring a standard JMS interface and/or a file based interface, this software can be downloaded onto the Participant RTGS webstations to securely channel batches of payments to the central Payment Originator.
- Statistical Database and Reporting Module - This database is the repository of all information pertaining to the daily processing of transactions by the Montran RTGS. It maintains the audit history of all transactions processed by the RTGS and can be used to generate required reports.
- Billing Module - This module interfaces with the Database and Reporting module to calculate charges and produce customer billing statements. Statement production can be customized to Bank requirements. Automatically produced statements can be printed, or transmitted via available networks.
Security
The Montran RTGS provides the highest level of protection and confidentiality of transaction information in the industry. The security standards are designed to meet or exceed those of the SWIFT network, even when not directly interfacing with SWIFT. Data access security is provided through both digital signature and encryption technology based on Public Key Technology.
For any sensitive operation, a four or even six‐eye approval policy is applied.
Screens are designed to be user friendly and intuitive, with customizable menus by way of user profile functions. The system supports integration with an LDAP server as a Centralized User Repository, Single Sign On and two‐factor authentication.
