Payment operations are an integral part of the economic system of any country and their basic function is to enable a safe and effective use of cash as a means of payment as well as the execution of cashless payment transactions, i.e., the transfer of funds from the payer to the payee. A successful and safe functioning of payment operations is also of exceptional importance for the central bank, the institution responsible for the functioning of the national payment system, as well as for the overall financial system and all of its participants.
Payment operations comprise a set of instruments, procedures, rules and technical support for sending information and the settlement of transactions between participants. In a narrower sense, payment operations include formal arrangements based on contracts and legislation, with standardised rules and contractual relations for sending, clearing and settling of liabilities and instruments between participants.
The functioning of payment operations in the Republic of Croatia is regulated by a series of acts, which include: the Payment System Act, Electronic Money Act, Act on the Implementation of EU Regulations Governing Payment Systems, Act on Settlement Finality in Payment and Financial Instruments Settlement Systems, Foreign Exchange Act, as well as other EU regulations.
Payment services may be provided by credit institutions, electronic money institutions, electronic money institutions under exemption and payment institutions.
Payment operations in the Republic of Croatia are carried out through four payment systems:
- the Croatian Large Value Payment System (CLVPS),
- the National Clearing System (NCS),
- TARGET2 and
The Payment System Act governs payment operations, payment services, payment service providers, obligations to inform payment service users about the conditions for the provision of and about the provision and use of payment services for the purpose of the protection and security of financial market participants. The Payment System Act also governs the operation and supervision of payment institutions and the establishment, operation and supervision of payment systems.
Payment services are provided by payment service providers (credit institutions and electronic money institutions) as their business activity includes cash deposits and withdrawals, the execution of credit transfer payment transactions, standing orders, direct debits and money remittance, issuing and acquiring of payment instruments and execution of payment transactions through payment cards and other telecommunication, digital or IT device (mobile telephone, etc.).
In addition to the Payment System Act, the national payment system is also regulated by the Electronic Money Act, which governs electronic money and electronic money issuers, the issuance and redemption of electronic money, conditions for the establishment, operation and dissolution of electronic money institutions having their head office in the Republic of Croatia.
The Electronic Money Act also governs the supervision of operation and conditions under which electronic money institutions having their head office outside of the Republic of Croatia may operate in the Republic of Croatia.
Pursuant to the provisions of the above acts, the Croatian National Bank (CNB) also adopts subordinate legislation governing their implementation.