DVP stands for Delivery versus Payment. A party to a transaction pays for something when it is delivered. When there is a delivery from A to B, delivery is made by A, receipt is had by B. B, the party that receives, is obliged to make a payment.
The issue revolves around: 1) timing of transaction 2) value of transaction, and 3) trustworthiness of A and B.
The ideal situation is timing is matched for delivery / receipt and payment without any lag or deferral. If A and B had previous dealings and are completely trustworthy, then they may not mind delay of one or two working days. Whereas if trust has not been established, delay of one hour means the transaction is non-DVP. In terms of value, the larger the value, the greater the urgency for everything to be completely wrapped up.
Note: Whenever there is a delivery, there is a receipt; also known as non-RVP (non Receipt Versus Payment).
Exchanges: Tokyo Exchange to Implement DVP for Broker-Dealers.(delivery-versus-payment settlement)(Brief Article)
Aug 07, 2000; The Tokyo Stock Exchange will implement delivery-vs.-payment settlement among broker-dealer members in the first half of 2001 to...