Large Value Transfer System

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Large Value Transfer System

An electronic system allowing Canadian banks to transfer large amounts of funds instantaneously. The banks may use the LVTS on behalf of clients, but perhaps the most common usage is the transfer of funds for short-term loans between banks, including the Central Bank of Canada. Importantly, LVTS transfers are irreversible so as to reduce the possibility of fraud and other risks.
References in periodicals archive ?
LVTS will gradually change the way Canadians do business.
LVTS can transfer Canadian dollar payments between LVTS participants anywhere in Canada, in a matter of seconds.
As a result, LVTS payments are final and irreversible.
Moreover, because of the real-time risk controls and certainty of settlement on a same-day basis, LVTS will greatly reduce systemic risk - the risk that the failure of one financial institution to meet its payment obligations will cause one or more other financial institutions to fail.
The LVTS will help Canadian corporations to compete globally by ensuring the immediate and reliable transaction of national and international payments.
Before the LVTS was put in place, Canadian banks settled billions of dollars in payments by using a combination of paper checks and wire transfers.
The LVTS has two types of transactions: actual payments, and queries and messages relating to the payments.
Security becomes an issue when CPA members query the LVTS database, which is stored on a mainframe system.
If unauthorized people gained access to the LVTS system, they could cause an enormous amount of trouble,' says Fredda Cole, LVTS program manager.
The' new systems protect the LVTS database queries, commands, and responses.
Therefore, it is very important that external vendors involved with LVTS have established track records.