- What is continuous linked settlement and how does it operate? - What is a quotation and how does it work in cross currency? Solution What is continuous linked settlement and how does it operate? Continuous Linked Settlement Continuous Linked Settlement is a process by which a number of the world\'s largest banks manage settlement of foreign exchange amongst themselves, their customers and other third-parties. It is an industry initiative to eliminate the settlement risk in foreign exchange transactions. This is achieved by using a \'payment versus payment\' method, which provides a simultaneous exchange of currency values through Continuous Linked Settlement Bank International (CLS) How is CLS managed? Settlement Members have direct links to CLS to input deals on their own and their customers\' behalf. They effect settlement on the due dates through accounts held at the CLS Bank. User Members have the same direct access, but use a Settlement Member to handle their settlement on the due dates. Third Parties have no direct links to CLS, and their trades must be sent to CLS via a Settlement or User Member. Most banks (as well as major corporates with their own FX departments), that wish to use CLS, do so as Third Parties) How does Continuous Linked Settlement work? When a foreign exchange deal is struck between banks, each counterparty transmits the details to CLS Bank, where they are matched and held until the settlement date. At the start of day, each Settlement Member .