Delivery versus payment: Difference between revisions
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'''Delivery versus payment''' or '''DVP'' is a |
'''Delivery versus payment''' or '''DVP''' is a common form of [[settlement (finance)|settlement]] for [[securities]]. The process involves the simultaneous delivery of all documents necessary to give effect to a transfer of securities in exchange for the receipt of the stipulated payment amount. Alternatively, it may involve transfers of two securities in such a way as to ensure that delivery of one security occurs if and only if the corresponding delivery of the other security occurs.<ref>Principles for Financial Market Infrastructures (2012)</ref> |
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==Operational perspective== |
==Operational perspective== |
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From an operational perspective DVP is a sale transaction of negotiable securities (in exchange for cash payment) that can be instructed to a settlement agent using [[SWIFT:Message Types|SWIFT Message Type]] MT 543 (in the ISO15022 standard). Use of such standard message types is intended to reduce risk in the [[settlement (finance)|settlement]] of a financial transaction, and enable automatic processing. Ideally, title to an asset and payment are exchanged simultaneously. This may be possible in many cases such as in a central depository system such as the United States [[Depository Trust Corporation]] |
From an operational perspective DVP is a sale transaction of negotiable securities (in exchange for cash payment) that can be instructed to a settlement agent using [[SWIFT:Message Types|SWIFT Message Type]] MT 543 (in the ISO15022 standard). Use of such standard message types is intended to reduce risk in the [[settlement (finance)|settlement]] of a financial transaction, and enable automatic processing. Ideally, title to an asset and payment are exchanged simultaneously. This may be possible in many cases such as in a central depository system such as the United States [[Depository Trust Corporation]] |
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==References== |
==References== |
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{{Reflist}} |
{{Reflist}} |
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== External links == |
== External links == |
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* [http://www.iso15022.org/message.asp?src=msg&id=2 ISO 15022 - Business Elements: Delivery versus payment] |
* [http://www.iso15022.org/message.asp?src=msg&id=2 ISO 15022 - Business Elements: Delivery versus payment] |
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* [http://www.bis.org/publ/cpss101a.pdf] |
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== See also == |
== See also == |
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Revision as of 05:30, 27 November 2012
Delivery versus payment or DVP is a common form of settlement for securities. The process involves the simultaneous delivery of all documents necessary to give effect to a transfer of securities in exchange for the receipt of the stipulated payment amount. Alternatively, it may involve transfers of two securities in such a way as to ensure that delivery of one security occurs if and only if the corresponding delivery of the other security occurs.[1]
Operational perspective
From an operational perspective DVP is a sale transaction of negotiable securities (in exchange for cash payment) that can be instructed to a settlement agent using SWIFT Message Type MT 543 (in the ISO15022 standard). Use of such standard message types is intended to reduce risk in the settlement of a financial transaction, and enable automatic processing. Ideally, title to an asset and payment are exchanged simultaneously. This may be possible in many cases such as in a central depository system such as the United States Depository Trust Corporation
References
- ^ Principles for Financial Market Infrastructures (2012)
External links
See also
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