Gridlock Resolution in Interbank Payment Systems
AbstractThe paper analyses the severity of gridlocks in interbank payment systems operating on a real time basis and evaluates by means of simulations the merits of a gridlock resolution algorithm. Data used in the simulations consist of actual payments settled in the Danish and Finnish RTGS systems. The algorithm is found to be applicable to a real time environment and effective in reducing queuing in the systems at all levels of liquidity, but in particular when intra-day liquidity is scarce.
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Bibliographic InfoPaper provided by Bank of Finland in its series Research Discussion Papers with number 9/2001.
Length: 34 pages
Date of creation: 13 Jun 2001
Date of revision:
payment systems; liquidity; gridlock; algorithms; settlement;
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