Infrastructures

The Central Bank of Iceland is required by law to promote a reliable financial system and foster the stability of the Icelandic economy. The Central Bank is also required to undertake such tasks as are consistent with its role as a central bank, such as promoting an efficient and secure financial system, including payment systems domestically and with foreign countries. Payment and security settlement systems are important elements of the financial system, and it is thus important to ensure their efficient and secure operation. The role of the Central Bank in payment intermediation is multifaceted and is primarily carried out by the Financial Market Infrastructure Department, but other departments within the bank are involved in payment intermediation in various ways. Within the Financial Market Infrastructure Department are three units: Real-Time Gross Settlement (RTGS) System Operation, Oversight of Systemically Important Financial Market Infrastructure, and Issuance of Banknotes and Coin.

Greiðsluveitan is an independent private limited liability company owned by the Central Bank of Iceland. The purpose of the company is to operate payment intermediation systems for banks and other financial institutions, including maintaining payment intermediation infrastructure and ensuring its security. For further information, see the Payment Intermediation website.

Financial Market Infrastructure

According to Governor's Decision no. 1242, dated 18 October 2013, the criteria of the new BIS/IOSCO Core Principles for Financial Market Infrastructures (PFMI) shall form the basis of the Central Bank’s oversight and operation of systemically important financial market infrastructure in Iceland.

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Operations

The Central Bank owns and operates the only RTGS system in Iceland. The system provides payment intermediation services between financial institutions.

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Oversight

The oversight unit keeps abreast of developments in payment intermediation, with respect to both technological advances and EEA regulatory instruments. It also monitors payment and settlement systems that have been recognised as systemically important in accordance with Act no. 90/1999.

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Banknotes and coin

Issuance of banknotes and coin is an important element of the Central Bank of Iceland’s operations. The bank performs this task by maintaining the stock of cash in circulation and safeguarding its quality and credibility, among other things.

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