Intraday Liquidity Demand of Banks in Real- Time Gross Settlement System

In this study a simulation analysis is applied to address the change in banks liquidity demand due to a shift in settlement method brought about by adopting real time gross settlement system. at the first stage of this research, we use a data generator model along with some information on the time distribution of coded cheques over a working day in order to produce intraday flow of payments. then the output is fed to the bank of finland payment settlement simulator (bof-pss) to estimate banks intraday liquidity needs in satna. the results indicate the movement towards a real time gross-settlement system increases the liquidity demand of iranian banks in payment system by about 66 percent.