Hong Kong and Malaysia launch a new cross-border payment-versus-payment link

Press Releases

13 Nov 2006

Hong Kong and Malaysia launch a new cross-border payment-versus-payment link

The Hong Kong Monetary Authority (HKMA) and Bank Negara Malaysia wish to announce that the new cross-border payment-versus-payment (PvP) link between Hong Kong's US Dollar real time gross settlement (RTGS) system and Malaysia's Ringgit RTGS system has been launched on 13 November 2006.

The link, which starts operation today, will eliminate settlement risk in foreign exchange transactions between the US Dollars and Malaysian Ringgit by ensuring the simultaneous delivery of US Dollars in Hong Kong and Ringgit in Malaysia. This is the first cross-border PvP link established in Asia.

On 8 December 2005, the HKMA and Bank Negara Malaysia signed a Memorandum of Understanding on the establishment of the PvP link. Following the completion of system development and testing, the link went live on schedule today.

The link is operated in Malaysia by Bank Negara Malaysia and in Hong Kong by Hong Kong Interbank Clearing Limited, which operates the interbank clearing systems in Hong Kong, and is jointly and equally owned by the HKMA and the Hong Kong Association of Banks.

Mr Joseph Yam, Chief Executive of the HKMA, said, "The link between the US Dollar RTGS system in Hong Kong and the Ringgit RTGS system in Malaysia is the first cross-border PvP link between two RTGS systems for two different currencies in the region. Link of this nature provide a safer and more efficient payment flow and enhance monetary and financial stability by eliminating settlement risk arising from the delivery of different currencies in different time zones."

Tan Sri Dato' Sri Dr. Zeti Akhtar Aziz, Governor, Bank Negara Malaysia, said "The establishment of this PvP link will further promote collaboration and cooperation of payment systems in Malaysia and in Hong Kong. It will also further enhance efficiency in the areas of payment and settlement systems, providing greater support to trade and investment flows in this region."

For further enquiries, please contact:

Hong Kong Monetary Authority

Sara Yip, Manager(Press), at (852) 2878 8246 or
Ying-ying Cheng, Manager (Press), at (852) 2878 1687

Bank Negara Malaysia

Abu Hassan Alshari Yahaya, Director (Corporate Communications),
at (603) 2691 9335

Hong Kong Monetary Authority
Bank Negara Malaysia
13 November 2006

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Last revision date : 13 November 2006