Cover announcements and reimbursement agents checkpoint
Check whether you can tell the announcement path from the money path in a cover payment, and read a reimbursement agent chain correctly.
QUESTIONS AS TEXT
Q1. In a cover payment, the pacs.008 announcement goes directly to the creditor agent. What does the reimbursement agent carry?
Answer: B: The cover value — the money that funds the payment, moving on its own path between the debtor agent and the creditor agent.
A cover payment splits into two paths: the pacs.008 announcement travels directly to the creditor agent, telling it a payment is coming and who to expect the funds from. The cover value itself travels separately, through whichever correspondent banks — the reimbursement agents — actually connect the debtor agent to the creditor agent.
Q2. Bank Alfa's cover has to pass through two correspondents before reaching Nordbank, the creditor agent. Which pacs.008 elements name those two correspondents?
Answer: A: Instructing reimbursement agent and instructed reimbursement agent.
pacs.008's Group Header carries InstructingReimbursementAgent and InstructedReimbursementAgent as distinct elements. The instructing reimbursement agent is the correspondent the debtor agent's cover goes to first; the instructed reimbursement agent is the one that ultimately credits the creditor agent.
Q3. A chain needs a third reimbursement agent because two correspondents cannot bridge the debtor agent and creditor agent alone. What does the cross-element rule say about naming it?
Answer: B: A third reimbursement agent may only be present if the instructing and instructed reimbursement agents are both present too.
pacs.008's cross-element rule ties the third reimbursement agent to the first two: a message may only carry a ThirdReimbursementAgent if both InstructingReimbursementAgent and InstructedReimbursementAgent are also present, since a chain cannot skip straight to naming a third correspondent it necessarily reaches through the first two.
Q4. Why does the creditor agent need the instructing and instructed reimbursement agents named in the announcement, rather than just waiting for the cover value to arrive?
Answer: A: So it knows which correspondent to expect the cover value from, instead of receiving an unexplained credit with no context.
Naming the instructing and instructed reimbursement agents lets the creditor agent recognise the cover value when it arrives, independent of whichever bank happens to be the creditor agent for this particular payment — the announcement and the money are reconciled by knowing, in advance, exactly which correspondent the funds are coming from.