Committee on Payments and Market Infrastructures

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The Committee on Payments and Market Infrastructures (CPMI) is a global standard-setting body that plays a pivotal role in enhancing the safety and efficiency of payment, clearing, settlement, and related arrangements. As part of the Bank for International Settlements (BIS), the CPMI supports financial stability and the broader economic landscape by fostering international cooperation among central banks and other financial institutions.[1][2]

Overview[edit]

Established initially as the Committee on Payment and Settlement Systems (CPSS) in 1990, the CPMI was rebranded in 2014 to better reflect its expanded mandate and activities. The committee's primary focus is on the oversight, policy, and operational aspects of payment systems, acting as a forum for central bank cooperation.

Functions and Responsibilities[edit]

Standard Setting[edit]

The CPMI sets global standards to ensure the robustness of financial market infrastructures (FMIs), including payment systems, central securities depositories, securities settlement systems, central counterparties, and trade repositories. These standards aim to mitigate systemic risks and enhance transparency and financial stability.

Monitoring and Analysis[edit]

The committee monitors and analyzes developments within its mandate to identify potential risks to the safety and efficiency of FMIs. This ongoing assessment helps in adapting and updating standards in response to emerging challenges and innovations in the financial sector.

Policy Development[edit]

CPMI develops policies and provides guidance to central banks and other relevant authorities on the regulation, supervision, and oversight of FMIs. This includes crafting policies that address new technological advancements such as digital currencies and distributed ledger technologies.

International Cooperation[edit]

As a member of the Financial Stability Board (FSB), the CPMI collaborates with other international standard-setting bodies, including the International Organization of Securities Commissions (IOSCO) and the Basel Committee on Banking Supervision (BCBS). This cooperation extends to coordinating policy development and implementation to enhance the global financial system's resilience.[3][4]

Key Publications and Initiatives[edit]

The CPMI publishes influential reports and guidelines that shape the practices of financial market infrastructures worldwide. Notable publications include the "Principles for Financial Market Infrastructures" (PFMIs), which set the international standards for safely and efficiently operating FMIs.

The committee also focuses on improving cross-border payments, as evidenced by its work on harmonizing the ISO 20022 financial messaging standard

Governance and Membership[edit]

The CPMI's governance structure includes a chairperson, a secretariat hosted by the BIS, and member representatives from central banks of major economies. The committee's membership has expanded over the years to include central banks from a diverse range of countries, reflecting its global scope

Impact and Future Directions[edit]

The CPMI continues to play a crucial role in shaping the infrastructure of the global financial system. Its work not only supports the stability of payment and settlement systems but also adapts to the challenges posed by financial innovation and the evolving digital landscape. Future efforts are likely to focus on enhancing digital payments, addressing cybersecurity risks, and ensuring that global financial systems can withstand new types of shocks.

References[edit]