Sometimes little things can mean a very great deal indeed. For people who work in the world of standards – whether for data, IT or just a plug in the wall – little things can have a massive impact. Data standards are like that. Changing the format of
just one field can mean changing almost every application system that you run or have to work with. Back in the early 1970s no programmer in the UK believed that the time would ever come when anyone could ever possibly pay over £99.99p per month as a National
Insurance contribution. As a result, every payroll system in the UK had to be changed in the late 1970s to allow for the impact of inflation – just to accommodate one extra digit in a field.
It looks like there is now a growing and strong acceptance that the industry needs something other than a BIC (Bank Identifier Code) to act as an identifier for legal entities. Some five years ago there was a major industry push to create an ISO-standard
International Business Entity Identifier (IBEI), but that got sat on by some organisations that wanted the world just to use the BIC, irrespective of whether it was fit for purpose as a unique business entity identifier or not. And clearly the BIC has never
been fit for that purpose.
It looks like US industry participants, regulators and legislators are forging ahead with trying to define a new Legal Entity Identifier (LEI) standard that has a much better chance of meeting the industry’s requirements, and that may become the basis for
a new ISO standard. And that could mean a change to many/most/every application system across the financial services sector internationally when it comes to areas like financial messaging between institutions.
Just one little field to change, but...