Securing daily payments
Payment is a critical activity for the functioning of society. In Finland, payment services are based on systems operated by banks, the central bank and private entities.
In Finland, banks and other individual entities have long taken measures to improve their preparedness for various contingencies. To complement this, the authorities have put in place a backup system for safeguarding daily payments in situations where normal European payment systems or systems of specific banks would be unavailable due to a severe disruption or emergency in society.
Although the creation of backup systems for daily payments is a part of normal preparedness by the authorities, in spring 2022 Europe’s new security policy environment hastened the introduction of the solution. The Act on Certain Backup and Emergency Arrangements in the Financial Sector (666/2022) defines the content of the backup system securing daily payments and the responsibilities of the parties. The backup system further improves the crisis resilience of society.
The Financial Stability Authority is responsible for maintaining the statutory national emergency account system. If a Finnish bank or a significant branch of a foreign bank operating in Finland were to suffer a severe and prolonged disruption, the national emergency account system could be deployed to provide account and card services to the customers of that bank. The customer relationships with the bank in question would remain unchanged. A customer of a bank suffering a disruption could make domestic credit transfers from their own bank account and receive payments on their account, make payments with a debit card, and withdraw cash from specified ATMs. A precondition for the functioning of the national emergency account system is that banks regularly report information on customers’ accounts and debit cards to the Financial Stability Authority.
In a situation where an individual bank is experiencing long-term operational problems or the normal European payment systems cannot be used, the Bank of Finland’s task is to ensure that domestic interbank payments can be made.
The backup system for daily payments was prepared in cooperation between the Ministry of Finance, the Ministry of Social Affairs and Health, the Bank of Finland, the Financial Supervisory Authority and the Financial Stability Authority. During the implementation phase, the work also involved entities critical to the banking and payment services sector and to everyday payments, such as retailers.