Designated Controlled Payment Systems
ZAHAV (Real-Time Gross Settlement)
The ZAHAV system was declared by the Bank of Israel as a “designated controlled” payment system in February 2008.
The ZAHAV system is a Real-Time Gross Settlement (RTGS) system launched in Israel at the end of July 2007, and operated by the Bank of Israel.
The ZAHAV system is an advanced system for efficient, reliable, and real-time final settlement of all shekel payments made in the Israeli economy. The system serves as the final clearinghouse of all payment and settlement systems operating in Israel, and plays a vital role in the payment and settlement array.
For more information on the ZAHAV system, click here.
Continuous Linked Settlement (CLS)
The CLS system operates as an international clearinghouse for currency exchange transactions, providing various settlement services to its members in the foreign exchange market.
The system began operating in September 2002 via the world’s largest banks, with the aim of reducing foreign exchange settlement risk.
Activity in the CLS system is similar to activity in RTGS-type systems, but instead of settlement in a single currency, CLS makes settlement and conversion transactions simultaneously in various currencies.
On-going activity in the CLS system is carried out by banking corporations, including banks that have the ability to send payment instructions directly for settlement in CLS on behalf of their customers. These banks are referred to as Settlement Members.
The system provides settlement services in 18 currencies, with the central banks of the relevant countries directly connected to it through their RTGS systems.
The CLS system was declared by the Bank of Israel as a “designated controlled” payment system on February 11, 2008. As such, and in accordance with the Payment Systems Law, payment instructions approved and carried out in the system are final and cannot be cancelled. The shekel began actively trading in the CLS on May 26, 2008.
The CLS system is owned by more than 70 global financial institutions, and is operated by the CLS Bank. It is supervised by an international supervisory group that includes representatives from all countries whose currencies are traded in CLS, and the Federal Reserve serves as the leading supervisor.
Upon the declaration, the Governor of the Bank of Israel exempted the CLS system from the provisions of various laws, including those relating to Bank of Israel supervision, after he was convinced that control over the system conducted by an international supervisory group is sufficient.
For more information on CLS, click here.