Almost two years after the launch of Continuous Linked Settlement (CLS), the world's first cross-border, simultaneous foreign exchange settlement system, Nike Inc. remains CLS' only corporate user.

For Nike, signing onto CLS has helped it whittle down the number of foreign exchange trades it must complete, increase oversight of liquidity positions and reduce the risk associated with failed settlements. "Rather than a corporate doing 50 FX trades in a week, and having to make manual payments to settle those trades, they can be netted off in just a handful of payments," says Clyde Muir, product manager at HSBC, who helped clinch the Nike deal.

But CLS is not for everybody. While conceptually the idea of CLS might seem an attractive one to most companies, the realities of CLS make it a long, hard slog for potential corporate users. CLS suppliers are the first to admit that non-bank clients derive only limited benefits from a system that is complicated to install and operate. "From the corporates' point of view, they have to figure out how to interface with their CLS provider, and this can take some treasury system development," says Conrad Steinmann, senior CLS product manager at Citigroup. Depending on the supplier and the corporate client's existing infrastructure, this development can take anywhere from eight weeks to a year. "It's a little less plug and play than for a commercial bank that uses SWIFT interface and is already dealing in real-time funding."

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