Committee On Payments And Market InfrastructuresEdit

The Committee On Payments And Market Infrastructures (CPMI) stands as the premier international forum for central banks and monetary authorities to shape the safety and efficiency of the core plumbing of the global financial system. It originated as the Committee on Payment and Settlement Systems (CPSS) and, through reforms within the Bank for International Settlements framework, evolved into a standards-setting body that works in close synchronization with IOSCO. Its mandate centers on payments, clearing, and settlement systems, and it oversees the market infrastructures that move the vast majority of high-value transactions, securities trades, and collateral exchanges across borders. The CPMI’s work is essential to reducing systemic risk, enabling smooth functioning of markets, and preserving the credibility of monetary sovereignty in a highly interconnected system. See Bank for International Settlements and Committee on Payments and Settlement Systems for historical context, and International Organization of Securities Commissions for its cross-border regulatory partnerships. The PFMI, published jointly with IOSCO, remains the backbone of its normative influence.

The CPMI operates as a forum where national authorities share best practices, tests of resilience, and practical approaches to risk management in the payment and market infrastructure space. It does not regulate directly in every jurisdiction; instead, it issues standards, guidance, and conceptual frameworks that national supervisors implement through their own legal and regulatory structures. In this sense, CPMI’s impact is felt most directly when jurisdictions incorporate its principles into domestic rules that govern central banks, payment systems, securities settlement systems, and central counterparties (Central counterpartys). Its work complements other global initiatives aimed at macroprudential stability and cross-border coordination, including the Financial Stability Board (Financial Stability Board) and the broader G20 agenda.

Overview

Purpose and scope: The CPMI focuses on the safety, efficiency, and resilience of payments, clearing, and settlement infrastructures, with particular attention to how institutions manage risk, provide settlement finality, and maintain continuity in stress scenarios. It covers large-value payment systems, securities settlement systems, and CCPs, as well as the related legal and operational frameworks that enable reliable settlement.
Core instruments: The Committee’s most influential output is the Principles for Financial Market Infrastructures (Principles for Financial Market Infrastructures), produced in partnership with International Organization of Securities Commissions. The PFMI lay out governance, risk management, capital and liquidity standards, settlement discipline, operational resilience, and legal documentation requirements that infrastructure providers and their participants should meet.
Governance and participation: The CPMI is chaired by senior officials from member central banks and monetary authorities, with a BIS-based secretariat coordinating workstreams. It relies on specialist working groups focused on payments, settlement systems, CCPs, liquidity and collateral, cyber resilience, and legal risk. The forumAlso includes observers from the private sector and other international organizations to ensure practical relevance, while keeping the ultimate responsibility for standards with public authorities.
Implementation and impact: While CPMI standards are not binding law in every jurisdiction, they guide national rulemaking and, in many cases, become de facto international benchmarks that market participants must meet to participate in global markets. The PFMI sonoften shape domestic risk controls, oversight regimes, and the design of cross-border settlement arrangements.

The CPMI’s standards are deeply grounded in the belief that a well-functioning payment and market infrastructure reduces systemic risk and lowers the cost of capital for households and businesses. In practical terms, this means robust governance, clear legal foundations for settlement finality, effective risk-management frameworks for liquidity and collateral, and strong operational resilience against cyber and other disruptions. See Market infrastructure for a broader framing, and Payment system for related concepts that CPMI seeks to harmonize at an international level.

History and evolution

Origins: The CPMI traces its lineage to the CPSS, established within the BIS to oversee the international payments ecosystem. The CPSS sought to coordinate central banking practices around settlement finality, liquidity management, and the integrity of cross-border transactions.
Renaming and expansion: In the 2010s, as the financial system’s architecture grew more complex and globalized, the CPSS was renamed the Committee On Payments And Market Infrastructures (CPMI) to reflect its broadened remit over both payments and market infrastructures. This shift aligned the committee with contemporary public policy language and the growing importance of market infrastructure resilience.
PFMI publication and uptake: The joint publication of the PFMI with International Organization of Securities Commissions in 2012 provided a comprehensive, principles-based framework for payment, clearing, settlement, and CCPs. The PFMI has since served as a reference point for national regulators, central banks, and infrastructure operators as they design, adopt, or modify rules.
Ongoing updates and focus areas: In the years since, CPMI work has expanded to cover cyber resilience, operational continuity, cross-border payment efficiency, intraday liquidity, governance veterans, and the legal underpinnings that support settlement finality. The body has continued to emphasize proportionality and risk-based regulation, acknowledging that different markets may require calibrated approaches suited to their size, sophistication, and risk profile.

Structure and governance

Membership: The CPMI comprises representatives from central banks and other monetary authorities who have a stake in the safety and efficiency of payments and market infrastructures. The BIS acts as the secretariat and central hub for administrative support, data collection, and technical work.
Working groups and topics: Its work is organized around focused groups addressing:
- Payments and settlement systems
- Securities settlement and central counterparties
- Liquidity management and collateral frameworks
- Cyber resilience and operational risk
- Legal and governance aspects of market infrastructures
Interaction with other bodies: The CPMI operates in coordination with IOSCO and, more broadly, with the FSB and national supervisory authorities. This coordination helps translate international standards into national rules and supports cross-border consistency in regulation and supervision. See International Organization of Securities Commissions and Financial Stability Board for related governance structures and oversight mechanisms.

The PFMI and other standards

Core concepts: The PFMI revolve around governance practices, risk management, settlement integrity, and resilience. They emphasize independent governance structures, robust credit and liquidity risk controls, proper settlement finality, and strong operational and cyber resilience.
Scope in practice: The PFMI guide the design and operation of LVPS (large-value payment systems), securities settlement systems, and CCPs. They touch on access policies, interoperability where appropriate, and the need for robust legal foundations that ensure enforceability of settlement obligations across jurisdictions.
Proportionality and flexibility: A recurring theme in CPMI guidance is proportionality—recognizing that one-size-fits-all rules can stifle innovation or impose excessive costs on smaller market participants. The CPMI’s framework aims to set high safety and efficiency standards while allowing for adaptable implementation by different jurisdictions and market structures. See PFMI for the detailed framework and its cross-border adoption.

Controversies and debates

Balancing risk and innovation: Supporters of CPMI standards argue that a strong, internationally aligned set of rules is essential to prevent systemic shocks, especially given the interconnected nature of modern finance. They contend that clarity, enforceable governance, and disciplined risk controls protect taxpayers and maintain market confidence.
Critiques from a pro-market perspective: Critics argue that aggressive, prescriptive, or universal standards can raise compliance costs, slow down innovation, and create barriers to entry for new technologies or smaller financial players. They favor risk-based, proportionate regulation that emphasizes competitive markets, greater vendor accountability, and faster adoption of safe, scalable technologies.
Public policy and equity discussions: Some critics of financial regulation frame debates around social outcomes, asking whether regulation should prioritize broad access or particular social goals. From a market-oriented standpoint, the focus is on stability, efficiency, and clarity of rules to minimize moral hazard, ensure predictable performance, and avoid unintended distortions that come from shifting regulatory aims.
Woke criticisms and counterarguments: In debates about regulation, some critics argue that calling for broader social or equity-oriented redesigns of infrastructure oversight can complicate risk management and undermine reliability. Proponents of a more traditional, risk-focused regulatory approach contend that core stability—rather than broad social engineering—provides the foundation for prosperity and opportunity. They argue that the most effective way to advance inclusive financial access is to maintain transparent, stable, and predictable infrastructure rules that encourage private investment and innovation within a robust safety net of supervision.

Global impact and implementation

National adoption: The PFMI and CPMI guidance have informed the design and revision of payment systems and CCP governance around the world. Jurisdictions have cited the PFMI in establishing or tightening standards for settlement finality, collateral management, liquidity risk controls, governance, and cyber resilience.
Market resilience and cross-border flow: By promoting common standards for how settlement is achieved and how risk is measured and mitigated, the CPMI contributes to smoother cross-border payments and reduces the likelihood that a problem in one part of the system triggers broader instability. This coordination helps protect financial stability without eliminating the benefits of competitive financial services.
Relationship to technology and innovation: As payments technology evolves—whether through instant payments, tokenization, or new interoperability models—the CPMI framework encourages a disciplined approach to adoption: high levels of risk awareness, clear legal underpinnings, and interoperable interfaces that do not create needless fragmentation or systemic risk.