What is an example of a high-value payment system based on RTGS?

The correct answer is Fedwire in the USA because it exemplifies a high-value payment system based on Real-Time Gross Settlement (RTGS). RTGS systems, like Fedwire, facilitate the immediate transfer of funds between financial institutions with the settlement occurring on a real-time basis. This means that transactions are processed and completed in real-time, ensuring both speed and finality. High-value payments typically involve large sums of money and are usually processed by central banks or designated authorities to ensure security and efficiency.

Fedwire is specifically designed for high-value transactions, making it a critical component of the payment infrastructure in the United States. It is used primarily by banks to send large value transactions and settle interbank obligations.

In contrast, while the other options are indeed payment systems, they do not operate on the principles of RTGS for high-value payments. The ACH Network processes transactions in batches rather than in real-time and is generally used for lower-value payments. PayPal is primarily an online payment platform that facilitates peer-to-peer transfers and does not function as an RTGS system for high-value payments. SEPA Instant Credit Transfer allows for quick transactions within Europe but is also designed for a broader range of payment amounts rather than strictly high-value transactions under RTGS principles.