Non-bank payment institutions to gain direct access to TARGET payment system from 6 October

“The extension of access rights to TARGET is intended to increase the efficiency of the European retail payments market, foster competition and innovation in European payments, offer more choice to consumers, and support the development of instant payments in the European Union. At the same time, non-bank participants in the system will have to meet strict conditions so that their participation does not pose a risk to financial stability,” says Evaldas Ruzgys, Director of the Market Infrastructure Department at Lietuvos bankas.

According to him, the possibility to connect to TARGET may be particularly relevant for payment service providers that process large volumes of transactions and participate in cross-system settlements, or seek strategic control over their settlement models.

When participating in TARGET, payment service providers may:

• reach more than 39,000 system participants directly when making payments;
• settle in central bank money, thereby reducing credit and settlement risk;
• manage liquidity independently from commercial banks or third-party infrastructure;
• use the same infrastructure with banks, which is essential for efficiency, transparency and operational resilience;
• directly access Eurosystem settlement solutions, including the TIPS platform for instant payments.

Direct access to TARGET is subject to the entry into force of Guideline ECB/2025/28 of the European Central Bank, which allows national central banks to grant access to TARGET to non-bank payment service providers on a discretionary basis.

Since mid-April, EMIs and PIs have been able to gain direct access to payment systems across Europe, including retail payment systems operated by central banks. However, direct access to TARGET has been postponed due to delays in some euro area countries in transposing the necessary amendments to the Settlement Finality Directive and Payment Services Directive.

The TARGET payment system operated by the Eurosystem ensures the free movement of cash, securities and collateral across Europe. TARGET services include T2 (for settling payments), T2S (for settling securities), TIPS (for settling instant payments) and ECMS (for collateral management).

So far, only banks and other credit institutions have had direct access to TARGET.

Requests to participate in TARGET are assessed and decided by the national central banks. In Lithuania, Lietuvos bankas manages access to the TARGET system.

More on the TARGET system, access possibilities and answers to FAQs can be found on the website of Lietuvos bankas.

Payments, Payment institutions , Electronic money institutions , TARGET