Payment and Settlement Systems in Finland 1995

This paper is an overview of domestic payment and settlement systems in Finland. It contains an up-to-date description of institutional aspects of payment systems, payment media used by non-banks, interbank exchange and settlement circuits and securities settlement systems. At the end of the paper, annual statistics are presented on payment and settlement systems and on payment media for the years 1989–1994.

Introduction: The banking system, bank accounts and funds transfers between accounts together constitute the basis of payment services in Finland. The use of advanced payment technology has made the system highly efficient by substantially reducing the need for manual work. This is reflected in a high level of automation in payments between banks and their clients (66 %) and especially in interbank payments (99 %).The early introduction of postal (1939) and bank giro (1942) systems
prevented the cheque from developing into an important payment medium and made credit transfers the main payment vehicle for small- and large-value payments. Debit cards are used fairly widely in retail payments. Prepaid cards were introduced in 1993 and electronic purses in 1994.

Author: Veikko Saarinen, Kirsti Tanila,Kimmo Virolainen

Source: Research Discussion Papers, Bank of Finland

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