Chilean Central Bank publishes new regulations applicable to payment systems

Friday, December 15, 2017

Statement from the Central Bank of Chile (machine translation)

December 15, 2017

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A fundamental legal responsibility of the Central Bank of Chile is to ensure the normal functioning of internal and external payments. In accordance with this responsibility, the Bank issues the regulatory framework that governs the operation of Payment Systems; both high value (high amount payments between financial entities) and low value (massive payments of low amount between natural persons and / or legal entities).

The main objective of this regulation is to achieve an efficient and safe operation of Payment Systems, especially considering their importance to sustain economic activity; for example, by allowing the extinction of all types of obligations among the participants of the financial system and the implementation of the monetary policy of the Central Bank of Chile (BCCh), ensuring the circulation of money.

In this context, the Central Bank of Chile published today for consultation the new Chapter III.H of the Compendium of Financial Regulations (CNF), subscribing the need to observe the Principles for Financial Infrastructures (PFMI) applicable to those Payment Systems (SP ), considered of systemic importance.

Specifically, this new Chapter adheres to the PFMI making them expressly required to the Real Time Gross Settlement System (RTGS System) administered by the Bank (Chapter III.H.4 of the CNF) and the Clearing House of High Value in Currency Payments National (Chapter III.H.5 of the CNF), administered by the Operating Company of the Clearinghouse of Payments of Alto Valor SA (Combanc SA).

It is important to emphasize that adhering to the PFMIs implies formalizing practices in habitual use in the Chilean financial system. In this sense, the main value of this initiative is to explicitly recognize in the Bank's regulation a commitment on the monitoring and surveillance of a broad set of internationally accepted standards.

The enactment of this regulation will be an important step to materialize the commitment assumed in January 2017 by the Ministry of Finance, the Central Bank of Chile, the Superintendency of Banks and Financial Institutions, the Superintendency of Securities and Insurance and the Superintendence of Pensions. , according to which each authority, gradually, would implement the PFMI according to their respective regulatory and supervisory framework.

The PFMI were issued in 2012 by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO), constituting a fundamental guide to strengthen the regulation, supervision and performance of financial market infrastructures, including payment systems. In this regard, it should be remembered that SPs are one of the five types of financial infrastructures (FMI) that support the functioning of capital markets, the financial system and the economy. The remaining infrastructures correspond to the Central Securities Depositories (CSD), Securities Settlement Systems (SSS) and Central Counterparty Entities (CCP), which are currently managed in Chile by entities regulated and supervised by the Superintendency of Securities and Insurance (SVS). A fifth type of infrastructure corresponds to Transaction Repositories (TR).

The operation of the FMI is interrelated, which explains the concern of all financial system authorities to ensure that they are subject to the most demanding international standards that may be applicable.

The consultation period will run until December 22, inclusive. The comments can be presented in the Bank's Office of Parts, or sent to the email address . It should be noted that the Bank will publish on its website the comments made within the indicated period, reserving the right to edit or summarize them; and, in your case, the answer that they deserve will be remitted through its Financial Policy Division.