Regulatory Requirements for Payment Processors in Belgium
The European Central Bank (ECB) has established regulations to oversee payment systems in Belgium, with a focus on ensuring their safety, efficiency, and stability. This article outlines the regulatory requirements for payment processors in Belgium, including systemically important payment systems (SIPS), non-systemically important payment systems (non-SIPS), and offshore payment systems.
Systemically Important Payment Systems (SIPS)
The ECB Regulation on oversight requirements for SIPS covers large-value and retail payment systems that are of systemic importance. These systems are subject to strict oversight requirements, including:
- Risk management: Ensuring the efficient management of risks
- Governance arrangements: Maintaining sound governance arrangements
- Objective and open access: Providing objective and open access to SIPS
- Efficiency and effectiveness: Ensuring the efficiency and effectiveness of SIPS
In Belgium, the ECB has oversight responsibilities for three SIPS: T2 (previously TARGET2), EURO1, and STEP2-T. The National Bank of Belgium also has joint oversight responsibilities with the ECB for the Mastercard Clearing Management System.
Non-Systemically Important Payment Systems (non-SIPS)
Non-systemically important payment systems consist of non-systemically important large-value payment systems (LVPS), prominently important retail payment systems (PIRPS), and other retail payment systems (ORPS). These systems are subject to the CPSS-IOSCO Principles for financial market infrastructures, which aim to ensure their safety and efficiency.
In Belgium, the Eurosystem applies the CPSS-IOSCO Principles to the oversight of non-SIPS. Non-systemically important large-value payment systems are subject to the complete set of principles, while only a subset is deemed relevant for non-systemically important retail payment systems.
Oversight Responsibilities
The Eurosystem’s oversight of payment systems in Belgium covers both SIPS and non-SIPS. The ECB has primary responsibility for overseeing SIPS, while the National Bank of Belgium has joint oversight responsibilities with the ECB for some SIPS. For non-SIPS, the Eurosystem applies the CPSS-IOSCO Principles to ensure their safety and efficiency.
Offshore Payment Systems
The Eurosystem strives to ensure a level playing field in its oversight requirements for payment systems processing in euro. Several offshore payment systems are either overseen as part of a cooperative arrangement or monitored for potential changes in circumstance. These include:
- Visa Europe Payment System (United Kingdom)
- BISERA7-EUR (Bulgaria)
Conclusion
The regulatory requirements for payment processors in Belgium aim to ensure the safety and efficiency of these systems, while also promoting a level playing field among offshore payment systems. By understanding these regulations, payment processors can ensure compliance with ECB guidelines and maintain a stable and secure financial environment.