Guiding principles for the Nexus Scheme
Scope: The Nexus Scheme is only intended to apply to Nexus payments, that is, payments which are initiated in an IPS in one country and completed in an IPS in another country. It does not apply to domestic payments provided by the IPS.
Minimal change: The Nexus Scheme is intended to avoid or limit any changes to local instant payment schemes and practices. It therefore would be restricted to defining the minimum set of common rules and standards required for the exchange of cross-border payments.
Compliance: The Scheme will set as a condition that actors will comply with any locally applicable AML/CFT screening, any currency controls and data privacy regulation and practices. This is a safeguard and sets expectations, but it is the local regulations and laws that creates the legal obligation for compliance.
Governance: The Scheme governance should reflect a balanced influence of stakeholders, including IPS operators, FX providers and possibly payment councils.
Adherence: Each participating IPS will operate under its own (domestic) scheme, which defines the rules applying to domestic instant payments. An IPS can become “Nexus enabled” by meeting the Scheme compliance criteria, such as implementing and testing the Nexus Gateway and by adhering to the Nexus Scheme. The IPS can then offer its members the ability to process Nexus Payments. As a first step, it will manage the on-boarding and adherence process of its members through eg an addendum to the local scheme rules. On completion, participants can start receiving and sending Nexus Payments.
The IPS will act as a local or delegated manager of the Nexus Scheme. Only the FX Providers will adhere to the Nexus Scheme directly, as FX Providers perform a role that is beyond the scope of the local IPS Scheme.
Standardisation: As much as possible, the Scheme will reuse existing common market standards and practices (such as ISO 20022 messages, for example).
Fees: The exact fees set by participants are defined by commercial agreements between those participants. Nexus prioritises transparency of fees so that Senders and Recipients can make informed choices about which providers to use, but does not set the level of fees (with the exception of fees to join Nexus, which are necessary to cover the costs of the Nexus Scheme manager). (See Fee & Revenue Model for further detail.)
IPS settlement processes: The Nexus Scheme will not set or alter rules, standards, processing and timing for the local IPS processing and settlement. These are already defined by the local IPS scheme.
Access criteria for Source and Destination Banks: The Nexus Scheme will not set access criteria for IPS members sending or receiving payment through Nexus. The general principle is that any participant who is a member of a specific Nexus-enabled IPS will be eligible to send payments through Nexus.
Settlement between FX Providers and Liquidity Providers: The Scheme will not define how FX Providers and Liquidity Providers should manage their exposures to each other. This is a bilateral matter to be agreed on by those parties.
Technology infrastructure: The Scheme is meant to be infrastructure agnostic, except for the Nexus Gateways and their communication.
Day-to-day operational management: IPS operators are responsible for managing operational issues with a single Nexus Gateway or communications between two Nexus Gateways. The Scheme manager would not be involved in day-to-day operations. (The exception would be where resolving an issue requires changes to the Nexus Gateway software network wide.)
Branding: It is not intended that Nexus payments should be branded. Nexus is a behind-the-scenes service which supports IPSs to provide cross-border payments, but Nexus itself is not customer facing.
Last modified 1yr ago