The Riksbank’s oversight of the financial infrastructure
Economic Commentaries, News The Riksbank oversees the financial infrastructure to carry out its statutory tasks of promoting a safe and efficient payment system and maintaining price stability. A smoothly-functioning financial infrastructure is essential for payments and the supply of capital to function and is thus a necessary condition for a safe payment system. The financial infrastructure is also crucial for the Riksbank to be able to implement its monetary policy, and in other ways provide the financial system with liquidity.
The financial infrastructure consists of systems through which payments and transactions with financial instruments are handled. This infrastructure makes it possible for individuals, companies and authorities to implement payments in a safe and efficient manner. It also makes it possible to safely and efficiently pay for and deliver financial instruments such as shares, bonds and derivatives, which are traded on the financial markets. In this way, it is the core of the financial system and forms a precondition for the efficient functioning of the financial system. If problems arise in the financial infrastructure, they can have serious negative consequences for the functioning of the financial system, with potentially substantial costs to society as a result.
This Economic Commentary describes why the financial infrastructure is important for financial stability, and how the Riksbank works on overseeing the infrastructure.
By Jill Billborn, who works in the Financial Stability Department of the Riksbank.