European Central Bank enables Danish krone settlement in T2 and TIPS and activates T2 multi-currency function

The European Central Bank announced that, from 22 April 2025, Danish market participants can settle wholesale and instant retail payments in Danish krone in the Eurosystem’s T2 and TARGET Instant Payment Settlement (TIPS) services following a successful migration. Danmarks Nationalbank has become the first non-euro area central bank to participate with its currency in all three TARGET Services, with Danish krone settlement already available in TARGET2-Securities since 2018. The onboarding is intended to align Danish financial markets with euro area standards, support optimised liquidity management and strengthen IT security for real-time settlement of wholesale and retail payments. With the inclusion of Danish krone, T2 activated its multi-currency function for the first time, and TIPS now supports three currencies: the euro, the Swedish krona and the Danish krone. The ECB also noted that the decision for Denmark to join T2 and TIPS was taken in 2020, the currency participation agreement was signed in 2024, and Danish market participants conducted testing campaigns and migration rehearsals from September 2023. The Eurosystem positioned multi-currency TARGET Services as a basis for broader participation beyond the euro area and for potential cross-currency settlement. Danmarks Nationalbank, Sveriges Riksbank and the ECB are collaborating on implementing cross-currency capabilities in TIPS, while Sweden, Norway and Iceland have expressed interest in joining additional TARGET Services with their national currencies.