Target2

TARGET2 is the euro area real-time gross settlement (RTGS) system used to settle large-value euro payments in central bank money. It is operated by the Eurosystem, a collaboration of the European Central Bank and the national central banks of the euro-area member states. Launched in 2007 to replace the earlier TARGET system, TARGET2 provides a single, integrated platform for cross-border euro payments and domestic large-value transfers.

Payments processed by TARGET2 are settled in real time with finality, meaning once a transfer is settled it cannot be reversed. This reduces credit risk for banks and supports the price and liquidity stability of the euro area. The system supports monetary policy operations and intraday liquidity management by participating central banks and financial institutions.

TARGET2 is built around a single shared platform (the TARGET2 platform) operated by the Eurosystem. Central banks provide accounts to their resident banks, and payments are routed across borders within the euro area. The system is designed to operate continuously, 24 hours a day, 7 days a week, with maintenance windows.

Users include euro-area banks and other eligible payment service providers that have access to TARGET2 accounts through their national central banks. TARGET2 interacts with other components of the Eurosystem's payments infrastructure, notably TARGET2-Securities (for securities settlement) and other euro-payment services.

Impact: TARGET2 underpins the efficiency and safety of euro payments, supports the Eurosystem's monetary operations, and is widely regarded as the backbone of the euro-area payment ecosystem.