Payment systems oversight

Payment systems allow us to make secure cashless payments – whether we’re paying for groceries in the supermarket or transferring larger sums from one account to another. The OeNB is the independent body that oversees the central payment infrastructure in Austria to ensure that systems operate reliably and risks are mitigated.

Why we need payment systems oversight

Disruptions in the flow of money in an economy can have severe consequences. If, for example, payments cannot be made or do not reach their intended recipients, consumers or businesses may suffer losses. In the worst case, even the entire financial system may become unstable.

Payment systems oversight aims to mitigate such risks, in particular 

  • credit risk (a participant in the payment system fails to meet their obligations)
  • liquidity risk (a participant fails to meet their obligations when they are due)
  • technical-operational risk (disruptions caused, e.g., by human error, IT problems or terrorist attacks)
  • systemic risk (problems that affect some participants or a payment system trigger a chain reaction)
  • legal risk (contracts cannot be enforced)

What is the OeNB’s role in payment systems oversight?

The OeNB oversees card payment systems, payment terminal systems, e-money systems and key Austrian financial market infrastructures for the settlement of interbank payments and securities transactions. The latter include clearing systems, central counterparties (CCPs) and central securities depositories (CSDs). If oversight reveals deficiencies or weaknesses in a system, the OeNB and the system operator agree on appropriate remedial measures. In its role as the competent authority for payment systems oversight, the OeNB acts independently and is not bound by any instructions. It also conducts follow-up audits to monitor the implementation of remedial measures.

Specifically, the OeNB’s tasks and responsibilities include

  • the designation of systems under the Finality Act: Transactions handled by designated systems are legally valid and binding on third parties (“final”). This reduces the legal risks for participants. The public ESMA list includes all systems designated in the EU.
  • regular and ad hoc system audits, for which the international CPMI-IOSCO Principles for Financial Market Infrastructures (PFMI) provide the main foundation; The  OeNB regulation on the system security of payment systems also builds on these principles. The regulation relates to the following aspects:
  • legal system security: The legal basis of payment systems is clearly defined and enforceable vis-à-vis all parties involved.
  • financial system stability: All system participants are aware of, and able to manage, the associated financial risks.
  • organisational system security: Internal processes and control structures are designed to ensure the smooth functioning of the system and remain effective even in exceptional circumstances and crises.
  • technical system security: The systems ensure a high, state-of-the-art level of confidentiality, integrity and availability. They are able to remain resilient and withstand cyberattacks. Oversight activities in this context are based on the cyber resilience oversight expectations for financial market infrastructures published by the ECB. 

Ongoing reporting by payment system operators

Payment system operators and participants report quantitative and qualitative information to the OeNB at regular intervals. The OeNB may conduct ad hoc system audits if the data indicate unusual developments or variations.

Payment system operators are also required to notify the OeNB when they start or cease operating a payment system and to provide details of the participants in their system.

Finally, payment system operators are obligated to report severe security and operational incidents to the OeNB (in accordance with the OeNB (in accordance with the Major Incident Reporting Framework for Payment Schemes and Retail Payment Systems).

Legal framework

The OeNB carries out its oversight activities on the basis of the following provisions: