News in 2014 |
Monthly Intraday Liquidity Monitoring Report
To facilitate Member’s management of intraday liquidity, a new Monthly Intraday Liquidity Monitoring Report was introduced to CHATS of all four clearing currencies on 17 November 2014. This new report facilitates Members to monitor their intraday liquidity usage and positions arising from CHATS activities.
Payment-versus-Payment Settlement for US Dollar ("USD") and Thai Baht ("THB")
A new cross-border payment-versus-payment (PvP) link between the USD CHATS and the BAHTNET system (Bank of Thailand’s Thai Baht RTGS system) for settlement of USD/THB foreign exchange transactions was launched on 28 July 2014. This new link facilitates PvP settlement of USD/THB foreign exchange transactions by eliminating settlement risk for the banking institutions in Hong Kong and Thailand.
Mandatory Provident Fund (MPF) Money Settlement Service
To enhance the efficiency of MPF funds settlement among trustees arising from investor portfolio transfers, the HKMA and Mandatory Provident Fund Schemes Authority have jointly introduced money settlement for MPF funds transfer (“MPF Money Settlement Service”) under the Central Moneymarkets Unit (“CMU”) of the HKMA with effect from 19 May 2014.
All MPF trustees in Hong Kong will participate as CMU members and engage settlement banks who are Members of the Clearing House to carry out money settlement on their behalf in the new MPF bulk settlement run in the HKD clearing system.
News in 2013
Electronic Bill Presentment and Payment (EBPP)
EBPP, a platform established by the joint effort of Hong Kong’s banking industry, provides a single consolidated platform that enables the general public to receive and pay bills, or to make donations and receive donation receipts via their internet banking systems. Effective from 18 November 2013, participating banks can exchange merchant, enrolment, bill presentment and donation receipt information through this centralised service. In addition, bill related payments and donations in HKD, USD or RMB can be settled via the corresponding clearing and settlement service.
Delivery versus Payment Link with Euroclear Bank
To facilitate cross-border collateralised lending and borrowing, the delivery versus payment (DvP) facilities of CHATS is extended to securities transactions settled in Euroclear Bank effective 17 June 2013. A linkage between the CHATS of HKICL and global tripartite repo system of Euroclear Bank is established for supporting DvP settlement of the transfer of collateralised securities in Euroclear Bank and the transfer of funds in CHATS simultaneously.
Alphanumeric Clearing Code
Effective 18 March 2013, three-digit alphanumeric clearing codes will be introduced for overseas direct participants (“DPs”) of USD Clearing, Euro Clearing and RMB Clearing, so as to save the usage of the current three-digit numeric clearing codes for local clearing member. Alphanumeric clearing codes will be assigned to overseas DPs that do not participate in bulk clearing and CCASS money settlement services (including paper cheque clearing, CCASS and other electronic clearing service, and/or CCASS real-time DvP service).
HKICL Network (ICLNet)
ICLNet, a secure, open, scalable, and high performance restricted-access private IP-based network for connecting the respective computer systems of the financial institutions and other licensed financial entities in Hong Kong to exchange electronic data efficiently and in a secure manner, commenced operations on 18 March 2013.
News in 2012
Dual Sites Operations
HKICL relocated its production clearing centre, data centre and main office from Hong Kong Island to Kowloon on 17 December 2012. The Hong Kong Island offices were converted into the Company’s backup clearing and data centre at the same time. With a view to providing better clearing service and bringing convenience to Members after HKICL’s relocation, clearing counter services are provided at both Hong Kong Island and Kowloon centres (Dual Sites Operations) to facilitate Members’ outward submission and inward collection of clearing/returned items.
Cross-border Autodebit Service between Guangdong (“GD”) and Hong Kong (“HK”) using China UnionPay HKD/RMB Debit Cards and Direct Debit RMB Account
Following the launch of the cross-border autodebit service between Shenzhen and HK that enables customers in Hong Kong to make autodebit payments to merchants such as utility companies, telephone operators, estate management companies, etc. in Shenzhen, China, this service has been extended to cover Guangdong province starting from 16 July 2012. This service provides greater convenience to customers in Hong Kong, who can make payments by debiting their China UnionPay HKD/RMB debit cards, or RMB bank accounts in Hong Kong to eligible merchants in the Guangdong Province.
Extension of Renminbi ("RMB") CHATS and CMUP Operating Window
To strengthen Hong Kong’s capability in settling overseas RMB payments, the HKMA and RMB CB have approved an extension of the RMB CHATS operating hours from the current window between 08:30 hours and 18:30 hours (the bank cut-off time), to between 08:30 hours and 23:30 hours on all weekdays except 1 January effective Monday, 25 June 2012. To facilitate RMB clearing members to better manage their RMB liquidity, the operating window of CMUP has also been extended from 18:30 hours to 23:30 hours to align with the system cutoff schedule of RMB CHATS.
News in 2011
RMB EPS and RMB Same Day Settlement EPS
As a continuous expansion of the RMB business in Hong Kong, we have launched the new RMB EPS and RMB Same Day Settlement services on 21 November 2011. These services facilitate the clearing and settlement of retail payment transactions of the participating merchants of EPSCO in RMB currency.
CCASS T+2 Money Settlement Service ("Service")
The Service was launched on 25 July 2011. Under the new arrangement, the overnight credit risk arising from the settlement gap between stock and money is minimized since the securities trades settled by the Central Clearing and Settlement System operated by Hong Kong Securities Clearing Company Limited and the interbank money settlement for these trades via HKICL would be done on the same day.
Renminbi ("RMB") Autopay and RMB Special CCASS Items
To support the expansion of RMB business in Hong Kong, we have launched a new RMB Autodebit and Autocredit service on 21 March 2011. Furthermore, to facilitate the timely clearing and settlement of RMB Initial Public Offering refund, a new bulk clearing service for RMB Special CCASS items was introduced also on the said date.
News in 2010
Regional CHATS Payment Service (“RCPS”)
To sustain Hong Kong’s status as a regional hub and to cope with the expansion of local Renminbi (“RMB”) business, the RCPS has been enhanced to include RMB in addition to the original 3 currencies, i.e. HKD, USD and Euro. This additional service is available since 20 December 2010. RCPS service providers who wish to provide RMB RCPS can subscribe this enhanced service with HKICL.
Same Day Settlement JETCO Items
This new service launched on 20 September 2010 allows the members of Joint Electronic Teller Services Limited (“JETCO”) an option to enjoy earlier funds availability as the interbank payments initiated by JETCO are settled within the same day of submission. The existing settlement on the working day after submission remains unchanged.
Same Day Settlement EPS Items
This new service launched on 20 September 2010 allows the participating merchants of Easy Payment System (“EPS”) an option to enjoy earlier funds availability as the settlement of the EPS items submitted to HKICL by Easy Payment System Company (Hong Kong) Limited is done within the same day of submission. The existing settlement on the working day after submission remains unchanged.
Cross-border Autodebit Service Using China UnionPay HKD Debit Cards
In view of the frequent economic interaction between Hong Kong and Shenzhen, we have launched a Cross-border Autodebit Service jointly with China UnionPay (“CUP”) and Shenzhen Financial Electronic Settlement Centre on 27 September 2010. This service facilitates payment made by debtors in Hong Kong to merchants in Shenzhen using CUP HKD Debit Card.
Browser-based RTGS front-end applications on SWIFTNet and Internet
The front-end terminal applications of the RTGS systems were successfully migrated from the text-based MBT/400 and CMT/400 to browser-based applications on 12 July 2010. After the migration, eMBT via SWIFTNet is the front-end terminal application of CHATS of all clearing currencies, while eCMT via SWIFTNet and iCMT via the Internet are the front-end terminal applications of the HKMA's CMU. The new eMBT, eCMT and iCMT are user friendly applications that improve the users’ operations in addition to the enhanced system functionalities.
Payment-versus-Payment Settlement for US Dollar ("USD") and Indonesian Rupiah ("IDR")
A new payment system linkage between the USD CHATS and the BI-RTGS System (Bank Indonesia's RTGS system) for payment-versus-payment (“PvP”) settlement of USD/IDR foreign exchange transactions was launched on 25 January 2010. This new payment systems linkage facilitates PvP settlement of USD/IDR foreign exchange transactions as a measure to eliminate settlement risk for the banking institutions in Hong Kong and Indonesia.
News in 2009
The establishment of cross-border links with the clearing and settlement systems of other Asian countries will help developing Hong Kong into a payment and settlement hub for the region. Following the successful linkage of USD CHATS with RENTAS (a real time electronic transfer of funds and securities system) in Malaysia to facilitate the real time payment versus payment transactions of USD/Malaysian Ringgit, and the settlement in Hong Kong of the cash leg of the real time delivery versus payment transactions of USD bonds traded in Malaysia, a cross border link for fund transfers between Hong Kong’s RTGS systems and the Mainland’s foreign currency RTGS systems was launched on 16 March 2009. This cross border link facilitates 2-way real-time USD, HKD and Euro funds transfers between banks in Hong Kong and banks participating in the RTGS systems of the respective currencies in the Mainland. A list of the banks in Mainland that participate in the cross border link can be found on HKICL website.
Effective 25 May 2009, the RTGS systems of all clearing currencies are able to support payment transactions transmitted in SWIFT message format.
News in 2008
Effective 23 June 2008, in addition to HKD cheques, USD cheques drawn on banks in Macau and presented by banks in Hong Kong can be settled on the following working day.
The RTGS operating hours were extended by one hour from 17:30 hours to 18:30 hours, Mondays to Fridays except General Holidays, effective 3 November 2008 in order to allow banks in Hong Kong that have business with the Mainland and western Asian countries more time to process their remittance payments which in turn could enhance their services and help developing Hong Kong as a regional payment HUB to serve the neighbour countries in the region.
A new clearing service to enhance the refund process of the electronic initial public offering (“eIPO”) of the Central Clearing and Settlement System (“CCASS”) was launched on 15 December 2008. Under this new service, the inter-bank settlement of the eIPO refund monies is performed on the refund day so that the CCASS participants can receive the refund monies in good funds on the same day instead of previously on the working day following the refund day. .
News in 2007
The Regional CHATS Payment Services was launched in July 2007 which linked all participants of the existing HKD, USD and Euro RTGS systems in Hong Kong in order to build an extensive correspondent network to facilitate the cross-border payments through the RTGS systems in Hong Kong during Asian business hours.
To support the clearing and settlement of the RMB-denominated transactions in Hong Kong, a full-fledged Renminbi RTGS system, and the RMB local cheque clearing were introduced on 18 June 2007.
The one-way clearing for HKD cheques drawn on banks in Hong Kong and presented by banks in Macau was introduced in August 2007 to reduce the time taken for Macau residents to receive funds.
The linkage between Hong Kong’s USD RTGS Systems and Malaysia’s Rentas Scriptless Securities Trading System for delivery-versus-payment settlement of USD bonds in Malaysia was introduced on 12 November 2007. This linkage eliminates settlement risk of USD bonds issued and traded in Malaysia by ensuring simultaneous delivery of US dollars in Hong Kong and USD bonds in Malaysia.
The opening of the RTGS settlement window was advanced by 30 minutes from 09:00 hours to 08:30 hours with effect from 3 December 2007 in order to allow banks more time for the settlement of CCASS related payments given the booming stock market, which in turn helps banks to better manage their liquidity for the settlement of CCASS items.
News in 2006
Payment versus Payment (PvP) Settlement for USD and Malaysian Ringgit (MYR)
The Hong Kong Monetary Authority and Bank Negara Malaysia (BNM), the Central Bank of Malaysia has agreed to establish a link between the Ringgit real-time gross settlement system in Malaysia (the RENTAS system) and the USD real-time gross settlement system in Hong Kong (USD RTGS system). This payment link enables the reduction of foreign exchange settlement risk through the implementation of a PvP mechanism during the Malaysia and Hong Kong business hours, and helps to increase the efficiency and safety of payment systems in Malaysia and in the region, in particular to manage FX settlement risk exposure for the FX transactions involving the US dollar and MYR.
This new system was launched on 13 November 2006.
Renminbi Settlement System
HKICL has been engaged by Bank of China (Hong Kong) Limited, the Clearing Bank ("CB") for RMB business in Hong Kong, to develop a Renminbi Settlement System ("RSS") that provides participants of this system with RMB cheque clearing service, and real-time RMB payment services including RMB position-squaring, remittance processing, and RMB bank card payment.
Licensed banks in Hong Kong, as well as their credit card subsidiaries can join the RSS with the permission from the CB and the HKMA, and each participant has to maintain a settlement account with the CB. The RSS is launched on 6 March 2006.
News in 2004
Continuous Linked Settlement (CLS) System
The Hong Kong dollar has been included in the CLS System with effect from 6 December 2004. The CLS System is a global clearing and settlement system for cross-border foreign exchange transactions operations by CLS Bank International. The inclusion of the Hong Kong dollar into the CLS System enables foreign exchange transactions involving the Hong Kong dollar to be settled through the CLS System on a payment-versus-payment basis.
The existing CLS eligible currencies are: US dollar, Euro, Yen, Sterling, Swiss Franc, Canadian dollar, Australian dollar, Swedish Krona, Danish Krone, Norwegian Krone, and Singapore dollar. HK dollar joins three other currencies i.e. New Zealand dollar, Korea Won and South African Rand, to become one of the CLS currencies that can be settled through CLS Bank International.
Hong Kong/Shenzhen Joint Clearing for USD Cheque
HKMA and People's Bank of China Shenzhen Central Sub-branch have agreed to extend the cross-border cheque clearing between Hong Kong and Shenzhen to USD cheques modelling on the existing HKD counterpart to improve the efficiency of clearing and settlement of USD cheques drawn on banks in Hong Kong and presented to banks in Shenzhen, and vice versa. Bank of China (Hong Kong) Limited has been appointed to act as the agent bank in Hong Kong for this new service that has been launched on 23 July 2004.
CHATS Optimizer for HKD Paper Cheque Settlement
To optimize the liquidity of banks during initial public offer (IPO) activities, a new payment type has been introduced to HKD CHATS for payment transfers that are netted and settled at the next scheduled HKD paper cheque settlement run. Such payments facilitate the recycling of liquidity from the receiving bank in an IPO to other banks. This new function was available on 14 June 2004.
HKICL Services Limited
Our Board of Directors has approved the incorporation of a wholly owned subsidiary, HKICL Services Limited ("HSL"), to take on new businesses which are not directly related to interbank clearing and settlement services. HSL was incorporated on 30 April 2004 and its business commenced on 31 May 2004. HSL's Board of Directors, Board Sub-Committee and management team are the same as those of HKICL. HSL is situated at HKICL's premises.
HKD and USD RTGS Link between Guangdong and Hong Kong
Similar to the RTGS linkages with Shenzhen, new HKD and USD RTGS linkages are established between Hong Kong and Guangdong (except Shenzhen) to facilitate the two-way real-time HKD and USD funds transfers between banks in Hong Kong and the HKD RTGS and USD RTGS participating banks in Guangdong.
BOCHK, the same agent bank appointed by the People's Bank of China Guangzhou Branch, settles HKD and USD payment transfers sent to and received from Guangzhou Electronic Banking Settlement Centre via BOCHK's HKD settlement account maintained with HKMA and BOCHK's USD settlement account with HSBC respectively.
This service was successfully launched on 15 March 2004.
News in 2003
Linkage between the Central Moneymarkets Unit (CMU) of the Hong Kong Monetary Authority (HKMA) and Euroclear
The direct link between HKMA's CMU and Euroclear, the Brussels-based international central securities depository, has been in production since 25 November 2002. This fully automated real-time link enables CMU participants to directly trade and settle their debt securities deposited in Euroclear, and settle the payments via RTGS system. This new connection significantly improves the ability of Asian investors to access international securities and counterparties in a secure and delivery-versus-payment (DvP) environment. In addition, the new link helps to promote efficient, cost-effective and low-risk cross-border securities transactions. This in turn will attract more investment activities to Hong Kong and enable Asian investors to better manage their liquidity.
Linkage between HKD and USD RTGS in Hong Kong and HKD and USD RTGS in Shenzhen
The linkage between HKD RTGS in Hong Kong and HKD RTGS in Shenzhen has been in production since 12 December 2002, which facilitates two-way real-time HKD funds transfers between banks in Hong Kong and the HKD RTGS participating banks in Shenzhen.
A USD RTGS linkage has also been put in place on 17 November 2003 to facilitate two-way real-time USD funds transfers between banks in Hong Kong and the USD RTGS participating banks in Shenzhen.
Bank of China (Hong Kong) Limited (BOCHK) has been appointed by the People's Bank of China Shenzhen Central Sub-branch to act as its agent bank to settle the HKD and USD payment transfers sent to or received from Shenzhen Financial Electronics Settlement Centre via BOCHK's HKD settlement account with HKMA and BOCHK's USD settlement account with HSBC, the USD clearing settlement institution in Hong Kong, respectively.
Euro Clearing in Hong Kong
With the Euro being one of the leading international currencies, the trading of Euro denominated assets is becoming increasingly prevalent in Hong Kong and the rest of the Asia Pacific Region. An efficient and reliable Euro clearing system is an important addition to Hong Kong's financial infrastructure.
On 3 July 2002, HKMA appointed Standard Chartered Bank as the Settlement Institution for the Euro clearing system in Hong Kong. In turn, Standard Chartered Bank appointed HKICL, the current operator of the Hong Kong dollar and US dollar clearing systems, as its clearing agent in September 2002.
The purpose of this Euro clearing system is to facilitate the efficient settlement of Euro transactions on a real-time basis within the Hong Kong time zone. The key functions of the Euro clearing system include an interbank Real Time Gross Settlement (RTGS) system, Payment versus Payment (PvP) settlement for Euro/US dollar and Euro/Hong Kong dollar foreign exchange transactions, and DvP settlement for Euro denominated debt securities through a linkage with HKMA's CMU.
The Euro clearing system was successfully launched on 28 April 2003.
Cheque Imaging and Truncation System
With the support of HKMA, the Hong Kong Association of Banks (HKAB) had commissioned HKICL, which operates the clearing house for cheques and other means of payments between banks, to implement the Cheque Imaging and Truncation System (CITS) on an industry-wide basis. HKICL had been working together with banks in Hong Kong to implement this new system for cheque processing, and the CITS was successfully launched on 21 June 2003.
With the CITS, the new image-based cheque clearing method has transformed the current clearing process driven by physical exchange of cheques. Under the CITS, low-value cheques are exchanged and cleared on the basis of electronic presentation of cheque images and the relevant cheque data. This mitigates the need for banks to deliver physical low-value cheques for clearing and settlement. The higher value cheques and special items (such as suspicious cheques) regardless of value are still physically presented together with their images to the paying banks.
In order to obviate the need for banks to make physical presentment of cheques for clearing, the Bills of Exchange Ordinance was amended to allow banks to present the electronic image of the cheques for payment. To this effect, the Bills of Exchange (Amendment) Ordinance 2003 was gazetted and enacted on 28 March 2003.
After the implementation of CITS, customers continue to enjoy the same level of service. There is no change to the practice pertaining to the writing of cheques, the deposit of cheques by payees, the timing of the availability of funds and the returning of unpaid cheques to payees.
Updated on 17 Nov 2014