On Mar. 21, 2024, ECB confirmed agreement with DEN CB for Denmark to join T2 and TIPS in Apr. 2025, Danish krone 3rd currency for instant payment settlement in TIPS.
Danish financial market participants have started testing both systems in preparation for launch, DEN CB already uses the T2 system for settling payments in euro.
Has used T2S platform for settlement of securities in both euro and krone since 2018.
Inclusion of Danish krone in Eurosystem's payment services will enable market participants in Denmark to use all 3 TARGET services to settle all payments and securities in their national currency and benefit from optimized liquidity management.
Will reinforce integration of Europe's financial infrastructures beyond the euro area, bring economies of scale and lay foundations for cross-currency payments.
The migration to TARGET Services has no legal impact for banks and mortgage credit institutions in Denmark, and they will have their contractual relationship with DEN CB.
On Dec. 8, ECB said Denmark applied to Eurosystem TARGET services.
ECB announced DEN CB has applied to join additional Eurosystem TARGET services by 2025, Danish krone will be available for settlement in T2 and TIPS payment systems.
On same day, DEN CB stated plans to join TARGET settlement platform, see #92927.
T2 System
ECB T2 payment system, is Eurosystem’s real-time gross settlement system (RTGS).
Like TARGET2-Securities (T2S), T2 and TIPS services support transactions in different currencies, securities settlement in Danish krone available on T2S since Oct. 2018.
With participation of DEN CB, payments in Danish krone will be possible in TIPS, T2.
Danish Application
T2 would then include the Danish krone by November 2025, DENN CB also expressed interest in joining TARGET Instant Payment Settlement (TIPS) within same time frame.
Including Danish krone in Eurosystem’s payment platforms will let market participants in Denmark use T2, TIPS services and settle payments in both euro and Danish krone.
Connection to TIPS, which launched in November 2018, means Danish banks, payment service providers can settle payments in both currencies within seconds.
Going Forward
T2 will replace TARGET 2 in Nov. 2022, to optimize TARGET liquidity management.
Mar. 2024 ECB Confirms Denmark Joining Date
On Mar. 21, 2024, ECB confirmed agreement with DEN CB for Denmark to join T2 and TIPS in Apr. 2025, Danish krone 3rd currency for instant payment settlement in TIPS.
Danish financial market participants have started testing both systems in preparation for launch, DEN CB already uses the T2 system for settling payments in euro.
Has used T2S platform for settlement of securities in both euro and krone since 2018.
Inclusion of Danish krone in Eurosystem's payment services will enable market participants in Denmark to use all 3 TARGET services to settle all payments and securities in their national currency and benefit from optimized liquidity management.
Will reinforce integration of Europe's financial infrastructures beyond the euro area, bring economies of scale and lay foundations for cross-currency payments.
The migration to TARGET Services has no legal impact for banks and mortgage credit institutions in Denmark, and they will have their contractual relationship with DEN CB.
Regulators
DEN CB; ECB
Entity Types
B/D; Bank; MSB
Reference
DEN CB PR, 3/21/2024; ECB PR, 3/21/2024; PR 12/8/2020
