CTP Payment Systems and Technology 2

Question 1

Which payment rail is best suited for sending a large corporate payment that must settle the same day with immediate finality?

Accepted Answer

Fedwire Funds Service

Answer

Fedwire provides real-time gross settlement (RTGS) with immediate, irrevocable finality, making it ideal for large-value same-day payments.

Question 2

A treasury team wants to reduce float by collecting payments electronically. Which ACH transaction type would they use to pull funds directly from a customer's bank account?

Accepted Answer

ACH debit (PPD)

Answer

An ACH debit (PPD for prearranged payment and deposit) allows a company to pull funds from a customer's account with prior authorization.

Question 3

What is the primary risk distinguishing ACH payments from Fedwire payments for a corporate treasurer?

Accepted Answer

ACH is not final until the settlement window closes and entries can be returned

Answer

ACH payments are not immediately final and can be returned by the receiving bank within defined return windows, creating settlement risk absent in Fedwire.

Question 4

The RTP network operated by The Clearing House differs from ACH in that RTP:

Accepted Answer

Provides 24/7/365 real-time settlement with immediate funds availability

Answer

RTP settles transactions individually and immediately around the clock, unlike ACH which processes in batches during business hours.

Question 5

Which SWIFT message type is used for a standard customer credit transfer between financial institutions?

Accepted Answer

MT103

Answer

MT103 is the SWIFT single customer credit transfer message used to instruct cross-border payments between correspondent banks.

Certified Treasury Professional Exam Practice Test

Certified Treasury Professional Exam Practice Test

CTP Payment Systems and Technology 2