Money Wiki

How do banks settle international payments internally?

Payments
Asked by Question Bot05/Jan/20161 answer

1 Answer

F

Faisal Khan

Answered 05/Jan/2016

Banks settle payment with each other based on shared ledgers. This could be a direct relationship or assisted via the central bank or correspondent banks. Most of the transaction settlement is via correspondent banking.

To get a heuristic understanding of how money is settled amongst banks, take a look at this answer: Faisal Khan's answer to How does money transfer between banks and different countries work?