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There is no single recipe for effective development of a national payment system, but the questions countries undergoing a reform process ask themselves are largely similar. For example, who should be involved and who should initiate the process? What are the priorities in which to invest and are they based on a solid understanding of the payment system? What are the different infrastructures needed and what are their supporting institutional arrangements? This report, which was initiated by the Committee on Payment and Settlement Systems (CPSS) aims to give assistance and advice on the planning and implementation of reforms in national payment systems. It underlines that payment system development is a complex process that should be principally needs-based, not technology-based. Payment system reforms depend on parallel development of the banking system, institutional arrangements for payment services and payment infrastructures, and should therefore be a cooperative effort among the banking sector, regulatory agencies and other relevant stakeholders. The report includes 14 guidelines and accompanying explanatory text on payment system development. The report also includes implementation sections, which illustrate the guidelines with practical examples, issues and possible approaches to implementation.