Delivery versus payment

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Delivery versus payment is used to classify a business transaction. DVP trading is defined as transactions in which payment and transfer of the subject security occur simultaneously where:

  • little or no credit risk exists in the settlement process (e.g. central depository system such as DTC or Euroclear), and
  • the settlement period is the normal spot settlement period for the product and market, and
  • the transaction does not create credit risk after settlement.

Any transaction entered into with a negotiated settlement period beyond the normal cash settlement date for the particular product and market and any transaction with a settlement date more than 45 days from trade date is not considered a DVP transaction.

There is also non-DVP trading.

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