The Swift workers' remittances framework consists of contract templates, a market practice for service levels and product definitions, reference data services, ISO 20022 standards and a messaging service.

The Brussels-based co-operative says the scheme has been tested with a group of pilot banks and showed a decrease of 80% in cost, and a reduction from six to two months in the time taken to set up a new counterpart compared to proprietary bilateral arrangements.

Financial institutions see the workers' remittances market as a rich source of new customers and revenue. Traditional correspondent banking arrangements, however, have not delivered the price and time transparency or ease of use that customers expect, leaving the market open to non-bank competitors and innovative mobile-phone based services.

Swift says the contract templates, reference data and XML standards enable banks to use any payment product at both ends of the transaction. Critically, the service is commercially neutral, giving bank participants flexibility in consumer branding, pricing and foreign exchange for these payments.

Luc Meurant, head of banking markets at Swift, comments: "Banks will find this service attractive as it provides a cost-efficient framework between banks while allowing innovation and competition in the retail space."