Abstract
When Euro was introduced in 1999 as the European single currency, a large value payment system was also set up. The so-called Trans-European Automated Real-time Gross settlement Express Transfer (TARGET) system was expected to be the basis of both financial integration and European Central Bank (ECB) monetary policy. TARGET is actually a Real Time Gross Settlement (RTGS) system: that is to say, a network that brings intraday settlement in central bank money. According to the ECB, "security and business continuity has always been one of TARGET key features". Eight years later, we can wonder whether TARGET has met its objectives. Everyone agree with the ECB standpoint: TARGET has enabled the rapid integration of the money market. In 2002, the Governing Council of the ECB decided to revamp the TARGET System , so as to adapt it to the European enlargement process. What are the features of the current system, and why is TARGET 1 no more efficient enough? Which enhancements are going to be set up in the coming months?
