This guide describes:
how Nexus payments are processed
how fees are handled by each participant
the obligations for the different participants when sending and receiving Nexus payments
what the IPSO must do to process Nexus payments from a Source (sending) as well as a Destination (receiving) perspective
how errors and exception scenarios are resolved
Nexus payments are processed through the domestic instant payment systems in the Sender and Recipient’s countries. All funds movement takes place within the two IPS.
Nexus does not maintain any accounts, hold any funds, track balances or obligations on behalf of PSPs.
Nexus does not connect to or interact with the high-value real-time gross settlement systems of central banks.
Payment Process:
Within the Nexus payment flow, a payment is cleared and settled in both the Source Country and the Destination Country sequentially.
Failures at any point will lead to the payment being reversed and funds returned to the Source PSP and Sender.
Compatibility with different IPS settlement models:
Nexus is compatible with different domestic settlement models, including deferred net settlement and real-time gross settlement in central bank money.
Nexus is compatible with both 4-step as well as 5-step instant payment clearing and settlement processes. (In a 5-leg payment, an additional confirmation of settlement message is sent to the Creditor Agent.)
Ensuring certainty of settlement: In all cases Nexus requires that each IPS ensures settlement certainty, so that:
(a) Nexus payments will always be honoured, even in the event of the insolvency of any participant while the payment is being processed, and
(b) Nexus payments can be reversed in the case that any participant rejects the payment instruction (for any reason).
Certainty of settlement can be ensured through any effective mechanism, including: immediate transfer of central bank money; pre-funding; funds reservation; or loss-sharing agreements.
Use of ISO 20022: Nexus exclusively uses ISO 20022 standard messages (and APIs) to communicate with IPSs. IPSs who do not use ISO 20022 for domestic messages must translate those messages according to the Nexus guidelines before sending messages to Nexus, and after receiving messages from Nexus. Nexus does not provide a translation service; this must be handled by the IPS. See Messaging & Translation for further detail.
Message tracking: Every pacs.008 payment instruction must have a Unique End-to-End Reference (UETR) to allow tracking and investigation of the payment. If the Source PSP does not add this UETR, it must be added by the IPS before the message is sent to Nexus. See #toc159257057
Exceptions and disputes: Nexus provides a Service Desk to help tracking of investigations, recall requests and disputes. In the first release of Nexus, these cases must be managed manually. In a future release, Nexus will add support for the relevant ISO 20022 messages to enable these cases to be processed via automatic communication between each PSP’s systems (although human intervention may still be needed to make decisions based on the information provided through these messages).