Oversight of systemically important payment systems – operation, governance, and risk management

This chapter analyses the global standards for the oversight of systemically important payment systems and systemically important stablecoin arrangements that perform a transfer function, focusing on their sound and safe operation, governance and risk management. The Principles of Financial Market Infrastructures serve as a common, transnational baseline for analysing these aspects. The chapter illustrates how public policy objectives and the interests of stakeholders play a pivotal role in shaping governance arrangements in this sphere. It explores key aspects of operation, governance (including access and engagement with end users) and risk management frameworks. In particular, it analyses the relationships between a payment system operator, the board of directors (or equivalent), management, and other relevant stakeholders. The chapter grounds the discussion in specificities by exploring their implementation in the UK and the EU.