The Clearing House Interbank Payments System (CHIPS) is a funds-transfer network owned and operated by the New York Clearing House Association (NYCHA) to deliver and receive U.S. dollar payments between domestic or foreign banks that have offices located in New York City. The network consists of a small number of settling participants (large U.S.-chartered banks that settle end-of-day balances with each other) and a large number of nonsettling participants who maintain accounts with one of the settling banks. Settling participants handle settlements for nonsettling participants. Although a large volume of CHIPS payments are for settlement of U.S. dollar foreign-exchange contracts and Eurodollar investments, there are a significant number of domestic business-related transactions. The interbank settlement of payments will normally be completed by the end of the business day. Unlike Fedwire, a credit received through CHIPS may not be a final settlement and can be reversed later in the day. CHIPS functions through computer terminals located on the premises of the participating institutions, which are linked by leased telephone lines with the central computer located at the New York Clearing House Association. In general, expenses incurred by the NYCHA to operate the system are assessed against all participants on the basis of the total number of messages processed. (Federal Reserve-Commercial Bank Examination Manual)