A look back at the Large Value Transfer System (LVTS)
Payments Canada marked the last day of operations for the Large Value Transfer System on Friday, April 29, 2022.
Implemented on Thursday, February 4, 1999, the LVTS has served as Canada’s high-value payment system for over 22 years. In Planning an Evolution: The Story of the Canadian Payments Association, the development and launch of the LVTS is described as a “major endeavour” and the scope of the project as “as large as everything that the CPA [had] achieved since 1980.”
The LVTS was the first model of its kind in the world, a hybrid system that combined the benefits of the two main models for current payment systems. It achieved the real-time payment finality of a Real-Time Gross Settlement (RTGS) system, with the added benefit of lower collateral costs associated with a netting system. The launch of the LVTS was a monumental milestone for Canada’s payment ecosystem. The lower residual risk due to certainty of settlement and intraday finality meant enhanced safety and soundness for the Canadian financial system.
The soundness and reliability of the LVTS can also be seen in the way it continued to support the needs of our members and Canadians in times of crisis. Whether it was 9/11, the Northeast Blackout of 2003, the Global Financial Crisis of 2008 or most recently the COVID-19 pandemic, the LVTS continued to process payments in a reliable and efficient manner.
Thank you to our participants and key stakeholders who are working with us to ensure a successful end to the system.
LVTS by the numbers.
- In its lifetime, the LVTS cleared and settled over 133 million transactions valued at $846 trillion.
- On February 4, 1999, its first day of operations, LVTS processed 11,400 transactions valued at $90 billion.
- In 2020 (LVTS’ last full year in operation), the system processed an average of 41,400 transactions valued at $101 billion, every business day.
- In terms of peak payment processing days, on July 2, 2021, the LVTS processed 73,502 transactions, marking its biggest volume day ever.
- On February 26, 2021, LVTS settled $686.7 billion – a value record that is unbeatable to date.
Launched in summer 2021, Lynx replaces the LVTS as Canada’s high-value payment system. Lynx is used by participating financial institutions (FIs) to safely send wire payments on behalf of their customers, in Canadian dollars. Based on the real-time gross settlement (RTGS) model, wire payments cleared and settled using Lynx are fast, irrevocable and made with real-time settlement finality. Discover more about Lynx.