They include the SLIPS system which is also owned and operated by LankaClear and the $ clearing system operated by a commercial bank. Mr Anura de Silva, General Manager LankaClear will give you the technical details of the CIT System including some of the glitches that have surfaced in implementing the cheque imaging project. Let me now deal with the institutional and legal arrangements and the impact of payment reforms very briefly. The focus will be on (i) the market arrangements for payment services (ii) the legal and regulatory framework; (iii) the coordination of oversight of the payment system and regulation affecting the system; and (iv) mechanisms for consultation with stakeholders. The RTGS and SSS systems speedily transfer funds and make settlements of banks, primary dealers, financial institutions, investors, customers, the government and the public. These two systems bring about financial discipline among these stakeholders as they have to maintain adequate cash and reserves in their accounts to meet payment obligations. This also improves the liquidity management by banks as treasurers and fund managers have to produce accurate estimates of their daily liquidity requirements. More importantly, the users of the RTGS and SSS systems can use Central Bank funds throughout the day for settlement purposes and return them at the end of the day. Subject to the availability of acceptable collateral, the banks and primary dealers are provided with intra day liquidity by the Central Bank.
The RTGS was implemented in September 2003 and the system facilitates large value and time critical fund transfers and settlements electronically and on real time. In February 2004, the SSSS module was integrated to the RTGS System. To facilitate the operations of these systems, government securities are issued in scripless form and the system facilitates simultaneous transfer of government securities and settlement of funds through the RTGS on a Delivery versus Payment basis. The Central Bank continues to upgrade and enhance facilities to these two systems and in December 2005, the internet based facility called LankaSecureNet which enables the account holders of the Scripless Securities Depository System to obtain up to date details of their investments through the internet was introduced. While eliminating the systemic risks that was involved in the high value and time critical transactions, the Central Bank became the owner and operator of both the RTGS and SSS systems. The service provider of the retail payment system is LankaClear (Pvt) Ltd which is owned jointly by the Central Bank and the commercial banks. Two weeks ago, LankaClear (Pvt) Ltd introduced the Cheque Imaging and Truncation System to ensure that cheques deposited in any part of the country is cleared and settled within two days except in uncleared areas. The cheque imaging system eliminates regional disparities in cheque clearing and establishes a common clearing schedule. In addition to these two systemically important payment systems, there are other small scale payments and settlements arrangements.