The CPMI's work programme

The Committee on Payments and Market Infrastructures (CPMI) promotes the safety and efficiency of payment, clearing, settlement and related arrangements, thereby supporting financial stability and the wider economy. The CPMI monitors and analyses developments in these arrangements, and serves as a forum for central bank cooperation in related oversight, policy and operational matters, including the provision of central bank services. The CPMI is a global standard setter in this area.

The CPMI maintains an annual work programme that outlines the strategic priorities for its monitoring and analysis, policy work, and standard setting and implementation activities. The work programme is developed under the direction of the CPMI Chairperson with the feedback provided by the Governors of the Economic Consultative Committee.

Over the past few decades, payment services industry has undergone a radical transformation. New payment methods and interfaces have taken shape, and many more innovations are under way. Digitalisation and general improvements in payments have cast light on longstanding issues in cross-border payments: they are still slow, expensive, opaque and not inclusive. Against this background the Financial Stability Board (FSB), in coordination with the Committee and other relevant international organisations and standard-setting bodies, has developed a "roadmap" to enhance cross-border payments (building upon "Stage 1" and "Stage 2" reports). The roadmap sets out a comprehensive work programme through 2025 to address the identified challenges and the Committee is leading or co-leading 11 out of 19 building blocks. This ambitious multi-year project will require the Committee to continue to provide expertise and thought leadership in a timely and effective manner, as the topic is central to the Committee's mandate.

  • The Committee will continue with highest priority the work on cross-border payments, in close coordination with the FSB and other stakeholders.
  • To support the broader work on cross-border payments, the Committee will continue to monitor de-risking in correspondent banking in cooperation with the FSB and based on data provided by SWIFT.

Innovations in payments are gaining pace in both the private and public sector. These have important cross-border implications and potential global scale. The pandemic has led to even greater interest in digital payment methods in general and central bank digital currencies (CBDC) and stablecoin arrangements in particular. Work on these topics will also inform the cross-border payments agenda.

  • The Committee will, together with the International Organization of Securities Commissions (IOSCO), further analyse and address policy issues related to the application of the CPMI-IOSCO Principles for Financial Market Infrastructures (PFMI) to stablecoin arrangements.
  • The Committee will carry out analysis on the future of payments, covering issues across a range of areas, including multilateral payment platforms, stablecoin arrangements and an international dimension of CBDCs. The initial focus will be on exploring the potential these innovations could offer for cross-border payments, as described in the G20 cross-border payments programme.

The pandemic has led to changes in retail payments behaviour that could influence the future provision of payment services, including a sharp rise in digital payments and a decline in the use of cash.

  • The Committee will continue to monitor changing retail payments behaviour, collect and publish the Red Book statistics and share new developments in member jurisdictions through its regular meetings and other activities.

The periods of market turmoil over the last several years have demonstrated the benefits that central clearing brings for global financial stability. Progress in implementing the G20 regulatory reforms agreed after the 2008–09 financial crisis has promoted the use of central counterparties (CCPs), as well as enhanced CCP resilience, recovery planning and resolvability. However, the shift to central clearing has also further increased the systemic importance of CCPs. More recently, Covid-19 and the reaction of the financial system have raised new issues as well as accentuated existing issues, including those related to margin practices. The CCP issues are broad in scope and it is critical to look holistically at historic events as well as emerging risks.

  • The Committee will further examine whether and, if so, to what extent margin calls were, for at least some market participants, unexpectedly large in centrally cleared and uncleared markets. This work will also examine margin practice transparency, predictability and volatility during the March 2020 market turmoil and liquidity management preparedness of market participants to meet margin calls. This is joint work with the Financial Stability Engagement Group (FSEG) of IOSCO and the Basel Committee on Banking Supervision (BCBS) and being conducted as part of the broader international work on non-bank financial intermediation, coordinated by the FSB.
  • The Committee will, together with IOSCO, continue the work on CCP resilience and recovery. This includes: (i) identifying current and effective practices and potential gaps regarding CCP non-default losses; (ii) progressing on issues related to the improvement of default management auctions; and (iii) analysing the impact of client clearing concentration on CCP access and portability.
  • The Committee will conduct further work, in cooperation with IOSCO and the FSB, to consider the need for, and develop as appropriate, international policy on the use, composition and amount of financial resources in recovery and resolution to further strengthen the resilience and resolvability of CCPs in default and non-default loss scenarios.

There are a range of issues to be addressed that go beyond CCPs and are relevant to the financial or operational resilience of FMIs. The market turmoil in the early stage of the Covid-19 pandemic underscored the critical role that FMIs play in maintaining resiliency in the financial system. In response to the Covid-19 pandemic, FMIs were able to invoke business continuity plans and working-from-home arrangements at short notice, and have generally been able to continue operations. Yet concerns remain regarding the individual and collective preparedness of FMIs, their participants and other stakeholders, to respond to potential stress events.

In addition to issues that the pandemic has brought to the fore, it also highlighted existing issues relevant to FMIs and the broader financial system. Mitigating against current or future risks in FMIs remains a critical part of the Committee's work programme. A priority for the Committee remains its continued commitment to such work items that were in train before the pandemic, including those related to wholesale payments fraud at endpoints, cyber resilience and FX settlement risk. The Committee also will remain vigilant to emerging risks, such as climate change-related risks relevant for FMIs.

FX settlement risk
  • The Committee will further promote industry action to address FX settlement risk and collaborate with the BCBS to encourage the adoption of the 2013 BCBS supervisory guidance. Advancing this work through stakeholder engagement will also support the broader cross-border payments work.
Operational resilience
The implementation monitoring of the PFMI
Climate change-related risks to FMIs
  • The Committee organised a workshop on climate change-related risks to FMIs in August 2020 with a view to raising awareness among FMIs and their authorities as well as exchanging information on current practices. The Committee will consider possible follow-up work in this area and, as appropriate, collaborate with other standard setting bodies and the FSB.