The shift to instant payments and continuous settlement is often described as a regulatory or technological change. In practice, it is neither.
Intraday liquidity has always been an operational requirement—the ability of a bank to meet its payment and settlement obligations as they fall due during the day. What regulation has done is formalise expectations around this. What instant payments have done is remove any remaining buffer for managing it retrospectively.
As payment activity moves to real-time, intraday liquidity is no longer something that can be monitored periodically. It must be managed continuously and operationally, with systems that reflect how liquidity actually moves within the day.
At MORS, intraday liquidity is implemented as a module within the Asset Liability Management (ALM) framework, ensuring that intraday positions are directly connected to broader liquidity management, reporting, and forecasting.
Intraday Liquidity: Operational by Nature, Regulatory by Enforcement
From a supervisory perspective, intraday liquidity has been shaped by frameworks such as the BCBS 248 Monitoring Metrics , PRA SS5/21 and, more recently, ECB guidance on intraday liquidity risk management. These define how banks should measure, monitor, and report intraday liquidity positions.
However, these requirements are grounded in a fundamentally operational reality:
- Payments must settle on time
- Liquidity must be available at the moment obligations arise
- Timing mismatches between inflows and outflows must be managed continuously
As long as payment systems allowed for delay and netting, these requirements could be handled with a combination of buffers and periodic monitoring.
That is no longer the case.
With instant payments:
- Settlement is immediate
- Payment flows are continuous
- Liquidity must be available at all times
This shifts intraday liquidity into the core of daily treasury operations. Regulation reinforces this shift—but it is the payment mechanics themselves that make it unavoidable.
From Payment Activity to Liquidity Positions
In a real-time payment environment, the key requirement is not simply tracking balances, but continuously translating payment activity into liquidity positions.
MORS supports this by integrating multiple data sources, including:
- SWIFT MT and ISO 20022 (CAMT) messages
- Internal account and transaction data
- External interfaces such as Open Banking APIs
This allows the system to:
- Continuously update nostro and internal account balances
- Capture both inflows and outflows as they occur
- Provide a consolidated, cross-account and cross-currency view
The focus is on building a reliable, near-real-time representation of liquidity positions, rather than relying on static snapshots.
Monitoring Liquidity at Intraday Level
A core capability of the MORS intraday module is the ability to monitor liquidity at both daily and intraday granularity.
Users can:
- View current balances across accounts and currencies
- Track how liquidity evolves during the day
- Drill down to transaction-level detail when required
This supports operational use cases such as:
- Monitoring payment flows during peak periods
- Identifying concentration of liquidity usage across accounts
- Understanding how individual payments affect available liquidity
The same dataset underpins both operational monitoring and reporting, avoiding duplication of calculations.
Configurable Limits and Continuous Control
Intraday liquidity management requires continuous control over how liquidity is used.
The MORS solution enables banks to define limits:
- At individual account level
- Across account groups
- At currency level
These limits are monitored continuously as positions are updated. This provides:
- Early visibility of potential limit breaches
- Ongoing control of liquidity usage
- Consistent application of policies across entities and currencies
This moves intraday liquidity management from post-event monitoring to active control.
Supporting Regulatory Reporting Requirements
Regulatory frameworks require banks to report specific intraday liquidity metrics.
MORS supports this directly, including:
- Maximum intraday liquidity usage
- Available liquidity at the start of the day
- Total payment flows
These metrics are derived from the same data that supports operational monitoring. This ensures:
- Consistency between internal and regulatory views
- Reduced manual reconciliation
- Full traceability to underlying transactions
Intraday liquidity reporting is therefore not a separate process, but part of a unified framework.
Connecting Intraday Liquidity to ALM
A key design principle in MORS is that intraday liquidity should be managed within the ALM environment.
This ensures alignment between:
- Intraday positions
- Short-term liquidity views
- Overall balance sheet management
In practice, this allows:
- Intraday developments to feed into broader liquidity analysis
- Known future cashflows (such as FX settlements and maturities) to be combined with ongoing payment activity
- Treasury, risk, and reporting functions to operate on a consistent dataset
This integration becomes increasingly important as payment activity becomes continuous.
Combining Real-Time Monitoring with Forecasting
While instant payments increase uncertainty, a significant portion of liquidity flows remains predictable.
MORS combines intraday monitoring with forward-looking analysis by incorporating:
- Scheduled and committed cashflows
- Contractual maturities
- Settlement obligations
Users can:
- View multi-day forecasts
- Analyse positions by currency and account
- Drill down into underlying transactions
This provides a continuous view across time horizons, linking real-time activity with structured planning.
A Practical Approach to Intraday Liquidity
The shift to instant payments does not introduce a new type of liquidity risk—it changes how existing risk must be managed.
Banks require systems that:
- Capture liquidity movements as payments occur
- Provide consistent and reliable position data
- Support continuous monitoring and control
- Enable regulatory reporting without duplication
- Integrate intraday activity with broader ALM processes
The MORS intraday liquidity module is designed to support these requirements within a single framework.
Conclusion
Intraday liquidity has always been part of how banks operate. What has changed is the speed at which liquidity moves and the level of control required.
Instant payments remove the possibility of managing liquidity retrospectively. Regulation reinforces the need for robust frameworks. Together, they require a shift towards continuous, operational liquidity management.
MORS addresses this by embedding intraday liquidity directly into the ALM environment, combining:
- Near-real-time visibility
- Limit-based control
- Regulatory reporting
- Forward-looking analysis
This enables banks to manage liquidity consistently across time horizons, with intraday activity fully integrated into the broader balance sheet view.
Contact MORS to learn more about our Intraday Liquidity and ALM solutions.