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QuestionWhat is the role of the Bank in payment and settlement systems?

Answer

One of the purposes of the Bank is to maintain the functioning of payment and settlement systems so that they operate in a smooth and stable manner (Article 1 of the Bank of Japan Act).

To fulfill this purpose, the Bank, with regard to the settlement of funds, provides payment instruments in the form of banknotes and current account deposits at the Bank. As for the settlement of securities, the Bank operates the Japanese government bond (JGB) Book-Entry System and the JGB Registration System for Japanese government securities (JGSs). In order to operate these settlement services safely and efficiently, the Bank also provides the Bank of Japan Financial Network System (BOJ-NET).

Furthermore, with a view to ensuring the smooth and stable operation of payment and settlement systems, the Bank encourages initiatives for improving the safety and efficiency of private-sector payment and settlement systems, and provides support for their realization.

In this way, the Bank plays a key role in Japan's payment and settlement systems.

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