What Are the Functions of Settlement in the Payment Ecosystem?

[Suba]

In the financial world, settlement is defined as the final settlement in a payment transaction. Therefore, this settlement function also ensures that funds from the payer/sender have been transferred to another account legally and completely.

Generally, the settlement process begins when money is sent, whether via bank transfer, debit/credit card, e-wallet, etc., and includes authorization and verification of fund balances, clearing, and final settlement.
The following are some of the functions of settlement in the payment ecosystem:
1. Certainty and Finality
2. Minimizing Risk
3. Financial System Integrity.

 

[Augusta]

From the word settlement it is to finalized payment to s person which brings finalization of a business transaction