Payment systems and payment services within the financial system: A Turkey case about oversight and harmonization period within the European Union

The purpose of this study is to show the significance of good operating payment and settlement systems in terms of both financial stability for central banks in particular and for the economy in general and to give advice on what to do on oversight and legal infrustructure in our country.One of the major objectives of the central banks, having a supervisory role on payment systems, is to take measures in order to reduce or eliminate risks arising from designing and operation of these systems. Central banks being the overseer of payment systems with the main goal of ensuring financial stability play an important role in preventing risks, especially systemic risk, which may arise from these systems..CPSS and IOSCO have designated core principles for ensuring the efficiency and confidentiality of designing and operation of systemically important payment systems and have also put forward the responsibility of central banks in execution of these core principles. These principles include recommendations for central banks and related private sector institutions. These institutions have set general principles and methods for central banks that will oversight the conformity of the systems to the basic principles.An examination of international applications on oversight of payment and settlement systems show that most of the central banks implement oversight activities under a method and compatible with international standards. Similarly, in some countries it is seen that special regulations have been made in this field except the general rules in central banks acts. These special regulations support the operating and oversight of payment and settlement systems with a legal infrustructure.In our country, oversight activities on these systems seems insufficient. This action should be operated by the Central Bank compatible with international standards and covering all the systems in the country.Setting up special regulations considering EU rules in order to support oversight activities and to strengthen the legal infrustructure on payment and settlement systems and payment services will contribute financial stability and will meet the needs within this field.Key Words1) Payment Systems2) Settlement3) Central Banks4) Oversight5) Financial Stability