Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/241203 
Year of Publication: 
2020
Series/Report no.: 
Bank of Canada Staff Working Paper No. 2020-37
Publisher: 
Bank of Canada, Ottawa
Abstract: 
Canada currently has two core payment systems for processing funds transfers between financial institutions: the Large Value Transfer System (LVTS) and the Automated Clearing Settlement System (ACSS). These systems will be replaced over the next years by three new systems: Lynx, the Settlement Optimization Engine (SOE) and the Real-Time Rail (RTR). We employ historical LVTS and ACSS data to predict the demand for the future systems. The results show that small-value LVTS payments will likely migrate to SOE. Also, in the short run, about CAD 10,000 billion of LVTS and ACSS payments (per year) is anticipated to migrate to the RTR if not subject to maximum transaction values. These migration patterns raise important policy questions, such as whether the future systems should be subject to value caps and/or higher collateral requirements.
Subjects: 
Financial stability
Financial institutions
Financial services
Financial system regulationand policies
Payment clearing and settlement systems
JEL: 
C3
E42
G1
G2
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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