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A PSP in Nexus can be any licensed financial institution that is:
- A participant of a domestic IPS that is a Nexus Scheme participant (or plans to be)
- Able to send and receive instant payments through the domestic IPS (either through direct membership or some form of indirect or technical access)
- Licensed by a central bank or equivalent regulator, and regulated or supervised for safety, soundness and conduct
Detailed eligibility criteria are defined in the Nexus rulebook.
A PSP must sign an adherence agreement with their domestic IPS to become a participant in the Nexus Scheme. The adherence agreement requires them to comply with the various obligations and responsibilities of being a PSP in Nexus, as defined in the Nexus Scheme rulebook.
The IPS Operator is responsible for managing the adherence and onboarding of its member PSPs.
When an IPS joins Nexus, it shares the full list of its members of that IPS with Nexus. However, PSPs do not automatically become onboarded and reachable through Nexus. Each PSP must first undertake a number of steps.
At the point of onboarding, a PSP must inform Nexus (via the IPS Operator) of:
- the name of the PSP
- the financial institution identifiers used by the PSP eg BIC, LEI and/or any custom domestic identifiers (such as Bank State Branch – BSB - codes in Australia).
- whether the PSP supports the Request for Information (RFI) messages. (See Request for Information). If the PSP does, Nexus will send RFI requests to the PSP when preparing to send payments to the PSP’s customers.
- which Unique Payment Systems the PSP is a member of (ie in which payment systems can the PSP receive payments)
- the go-live date from which the PSP is able to receive Nexus payments
The IPSO will input this information into the Nexus administration portal (which the PSP does not have access to).
To start receiving payments through Nexus, the PSP must:
- Sign the adherence agreement with the PSP’s local IPS, committing to the rules and guidelines of the Nexus Scheme.
- Confirm that all payments the PSP receives through Nexus will be screened against the sanctions lists applicable in the PSP’s jurisdiction (and that the PSP will apply with any other regulations and laws applicable in the PSP’s jurisdiction).
Sanctions screening is currently done at the payment processing stage, but pre-screening may be possible – for example when responding to a proxy resolution request – in future versions of Nexus.
The PSP will also need to:
- ensure the PSP’s internal systems can handle and process the more data-rich Nexus-standard ISO 20022 messages. (The IPS may choose to translate the Nexus-standard messages into a domestic format before forwarding to the PSP.)
- ensure the PSP’s internal systems will display useful information to the Recipient (for example, on the statement, including the Sender’s reference message, name and country)
- update the PSP’s systems so that Nexus payment instructions received via the local IPS are identified as cross-border payments and screened before or immediately after they are accepted. (Domestic payments do not need to be screened against sanctions list, so this may require a change to the PSP’s workflow.)
- undertake a robust testing process with the IPS Operator and the Nexus Gateway to ensure that all systems are working as expected
Upon completing the steps above, the PSP should inform their IPS Operator. The IPS Operator will then inform Nexus that the PSP is “Reachable” through Nexus and the PSP will be able to start receiving Nexus payments.
To send payments through Nexus, the PSP must additionally:
- Integrate the Nexus APIs into the payment setup flow
- Ensure they can construct the Nexus-standard pacs.008 payment instruction (and other ISO 20022 messages used in the workflow) with all the necessary information
- Complete a robust testing process with the IPS Operator and Nexus Gateway to ensure that all systems are working as expected