What you should know about clearing and settlement institutions

On 1 January 2014, the Financial Markets (Amendment) Act 2014 entered into force. One of the amendments entails a licence requirement for clearing and settlement institutions. Until 1 April 2014, all clearing and settlement institutions were granted a licence by operation of law. The three-month period was granted for the institutions to prove that they met the licence requirements, failing which the Dutch Central Bank (DCB) could withdraw the automatically granted licence.

What are clearing and settlement institutions? The main task of clearing and settlement institutions is to facilitate payments by transfer. They provide for the forwarding, approval and netting (clearing and settlement services) of payments by transfer.

Why is supervision over large clearing and settlement institutions necessary? Nowadays the better part of the payments in the Netherlands is made by transfer. Any disruption of the payment transfer system could cause major damage…

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