ICELAND JOINS TIPS FOR INSTANT PAYMENTS
On June 24, 2026, an important agreement was signed between the European Central Bank (ECB) and Seðlabanki Íslands, marking Iceland’s inclusion in the Eurosystem’s TARGET Instant Payment Settlement (TIPS) system. This partnership will enable instant settlements for payments in Icelandic króna using central bank money, with the setup expected to be effective from 2028.
The addition of the Icelandic króna represents a significant expansion, making it the fifth currency to be processed through TIPS for immediate retail payment settlements. Currently, the euro, Swedish krona, and Danish krone are already operational within this framework, with the Norwegian krone anticipated to join in the same year as Iceland.
ECB President Christine Lagarde expressed enthusiasm regarding this development, stating, “We are delighted that more and more European countries, including from outside the European Union, are joining the Eurosystem’s TARGET Services.” She emphasized that this step enhances the integration of Europe’s financial infrastructures, promotes strategic autonomy, increases economies of scale, and strengthens economic relationships within the region.
Commenting on this advancement, Ásgeir Jónsson, the Governor of Seðlabanki Íslands, remarked that it represents a pivotal move in enhancing Iceland’s payments landscape to secure future resilience and efficiency. He noted, “Joining TIPS will bolster both the security and efficiency of instant payments in Iceland.” Furthermore, this integration will align Iceland’s payment processes with SEPA standards, leveraging the scale and expertise offered by the Eurosystem’s TARGET Services.
TARGET Services are designed by the Eurosystem, utilizing central bank money to facilitate seamless transactions among banks, businesses, and individuals. These services are built to accommodate transactions in multiple currencies beyond just the euro.
TIPS serves as the retail payment settlement system that allows banks and payment service providers to deliver real-time fund transfers every day of the year, ensuring constant availability to their customers.
For additional media inquiries, please reach out to Alessandro Speciale at +49 172 1670791 or via email at alessandro.speciale@ecb.europa.eu.
