TARGET2
The Eurosystem's real-time gross settlement system for large-value euro payments, replaced in 2023 by its successor T2.
The name stands for Trans-European Automated Real-time Gross settlement Express Transfer system, an acronym that was clearly engineered backwards. The first version launched with the euro in 1999 and was really a patchwork of national systems wired together. TARGET2, rolled out from November 2007, replaced it with a single shared platform built by the central banks of Italy, France and Germany. It settled interbank payments, central-bank monetary policy operations and, in effect, the liquidity of the whole euro area.
Outside the payments world it became famous for TARGET2 balances: the claims and liabilities between national central banks that build up when money flows from southern Europe to Germany. The Bundesbank's claim passed a trillion euros and became a cudgel in the euro debates. In March 2023 TARGET2 was replaced by T2, which speaks ISO 20022.