Large Value Transfer System - LVTS
Definition of 'Large Value Transfer System - LVTS'
An electronic wire payment system in Canada, facilitating the transfer of funds between large financial institutions, including the central Bank of Canada.
Investopedia explains 'Large Value Transfer System - LVTS'
LVTS transactions can be performed for banks or their clients. These transactions are instant, which improves the quickness and efficiency of business transactions. Once the transaction is sent through the system, it can not be reversed. This prevents insufficient funds, stop payments and fraud.
For example, because financial institutions borrow and lend money to each other, at the end of the day some firms have a shortage of money, while other firms have an excess amount. They use the LVTS to close out these short and long positions.