What is Continuous Linked Settlement (CLS)?

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Continuous Linked Settlement (CLS) is an international payment system launched in 2002 that operates a Payment-versus-Payment (PvP) mechanism to eliminate settlement risk, also known as principal risk or Herstatt risk, for foreign exchange (FX) transactions among its member institutions globally. By ensuring the simultaneous exchange of both legs of an FX trade, CLS processes over USD 7.0 trillion in daily payment instructions across 18 of the world's most actively traded currencies, significantly enhancing the stability and efficiency of the global financial market.

Continuous Linked Settlement (CLS)

What is Continuous Linked Settlement (CLS)?

What is Continuous Linked Settlement (CLS) and how does it mitigate the principal risk in foreign exchange transactions?

How does the Payment-versus-Payment (PvP) mechanism function within the CLS system to ensure simultaneous settlement?

What is the global scale and economic impact of CLS, including its transaction volumes and supported currencies?

What are the key benefits and operational challenges for financial institutions participating in the CLS system?

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