The Impact of Payment System Design on Tiering Incentives

Preprint OPEN
Robert Arculus; Jennifer Hancock; Greg Moran;
  • Subject: large-value payment systems; tiering; liquidity; simulation
    • jel: jel:E42 | jel:E58 | jel:G21

Tiering occurs when an institution does not participate directly in the central payment system but instead settles its payments through an agent. A high level of tiering can be a significant issue for payment system regulators because of the increased credit and concent... View more
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