An IPSO must sign an adherence agreement to become a direct member of the Nexus Scheme. The adherence agreement requires them to comply with the various obligations and responsibilities of being an IPSO in Nexus, as defined in the Nexus Scheme rulebook.
Eligibility requirements for Nexus will be defined in detail in the Nexus Scheme Rulebook, but at a high level:
- 1.An IPSO must be able to process individual payments between accounts in seconds.
- 2.An IPSO may use a Deferred Net Settlement model or real time gross settlement in central bank money.
- 3.Where the IPSO uses a Deferred Net Settlement approach:
- 1.net settlement must take place in central bank money
- 2.a pre-funding, collateral or other adequate risk management regime must be in place to ensure that there is no unsecured credit risk between PSPs during the settlement cycle.
- 4.The IPSO must meet the other obligations and requirements defined in the Nexus Scheme Rulebook.
Once an IPSO has signed the adherence agreement with the Nexus Scheme Organisation, it can start the technical process of integrating with Nexus and undertake technical testing.