Central Bank of Paraguay: Instant Payments in Paraguay

Posted on Jul 27, 2023 by Diego Legal, Manager – Operations and Payments Management, Central Bank of Paraguay

Diego Legal of the Central Bank of Paraguay


On May 23, 2022, the Central Bank of Paraguay (BCP) implemented the first phase of the Paraguayan Instant Payment System (SPI). This first phase consisted of implementing electronic fund transfers 24 hours a day, 7 days a week (24x7). For end customers, this implies the possibility of making bank transfers free of charge and with funds available in less than 1 minute. SPI is only for transfers in local currency (guaraníes, ₲), with a maximum amount per transaction of ₲ 5 million (approximately USD 700).

Within the SPI, banks have settlement and position accounts. Position accounts register bank clients’ operations, representing credits or debits, and calculate the net position of each bank with respect to every other bank. Net balances among banks are settled twice daily, and there are different limits and requirements in terms of the balances that banks must maintain to minimize any settlement risk.

The SPI includes several functionalities that will be implemented in two phases to achieve a smooth implementation. In this sense, the first phase included fast payments 24x7 (with functionalities available to banks related to managing their limits in the SPI and reporting options). The second stage will go live between September and October 2023. It will incorporate a series of functionalities available to customers to improve the user experience, promote using SPI as another payment method in stores, and incorporate new players into the SPI ecosystem. Some outstanding features are the option to use aliases, requests for payments, and payment initiation requests.

The Birth of SPI

SPI is the fifth system of what is known as the Payment Systems of Paraguay (SIPAP). SIPAP is administered by the Central Bank of Paraguay and was implemented on November 25, 2013. Initially, SIPAP included a real-time gross settlement system (RTGS), an automated clearing house (ACH), and a depository for government bonds (DEPO). In 2018, the Local Currency System (SML) was incorporated, which allows the interconnection with the RTGS systems of Argentina, Brazil, and Uruguay.[1]

A critical preliminary step for implementing SIPAP was ...

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[1] The LBTR is the only SIPAP system supporting transfers in dollars and euros. ACH is for batch transfers.