Guaranteed end-to-end integrity is a core objective of SWIFT’s approach to ISO 20022 migration and makes for an attractive selling point for players across financial services. Yet, given the scale, complexity, and cost of the project, is achieving a timely, effective ISO 20022 migration a realistic endeavour?
The new data-rich language and structure for payments information presents an immense opportunity for financial institutions to strengthen security, to reduce transaction errors and to improve efficiencies across the payments landscape.
Mandatory migration dates set by large organisations across the payments industry, such as SWIFT, provide clear deadlines which FIs must abide with. The ISO 20022 transition process by SWIFT for example, initially planned for November 2021 is now scheduled to take effect from end of 2022.
The challenge of developing a solution which allows FIs to handle ISO 20022 messages in a manner that keeps legacy systems intact, along with coordinating complex timelines across various deadlines such as the TARGET2 and T2S consolidation or EURO1 transition, may be a tall order, but it is one that cannot be ignored.
If institutions aren’t prepared before messaging networks have converted, they will struggle to find themselves compliant, let alone able to carry out fundamental business operations.
Financial institutions must pursue solutions which allow them to meet compliance deadlines while capitalising on the opportunities presented.
Though such solutions may be implemented in a collaborative way, or developed in-house, most FIs seems comfortable with third party engagement and outsourcing. Build structures are always cumbersome.
While these approaches each have merit, when tackling the migration in-house a clutch of issues that banks tend not to predict continue to appear. A key concern is that banks are viewing the migration to ISO 20022 as a ‘translation’ – a recipe for failure. The inevitable data truncation which follows this approach will render the institution non-compliant.
Ongoing pressure inflicted on FIs as a result of COVID-19 demonstrates how physical supply chain disruption has the ability to paralyse entire industries. In the world of payments, we’re seeing how external forces are moulding a new approach to transactions, underscoring the need for an integrated straight-through processed, manual and reconciliation-free approach to payments and payments data. ISO 20022 is planning to do exactly that.
Right now, businesses may be looking at business continuity, but they will also be very carefully approaching their long-term strategy and how they are going to weather the next storm. As we move toward a new normal, ISO 20022 provides the catalyst for FIs to take the lead and approach payments radically differently.
Join in this webinar from Finextra, in association with Volante Technologies to take part in the discussion on the following areas with industry experts:
- Why ISO 20022 is a true asset to the payments landscape
- Insight into completed ISO 20022 payment message adoption at a top European bank
- Achieving standards harmonisation across a suite of other industry-wide projects
- The impact of ISO 20022 migration both within financial institutions and their engagement with other institutions in the industry
- The tools and approaches financial institutions should consider to maximise efficiency across the migration project
- Gary Wright - Head of Research, Finextra [Moderator]
- Alain Schmid - Managing Director, Head of Payment Services, Credit Suisse
- Paula Roels - Head of Market Infrastructure & Industry Initiatives, Cash Management, Deutsche Bank
- Petia Niederländer - Head of Retail and Corporate Operations at Erste Group Bank AG
- Anne Levonen - Director, Product Management, Volante Technologies
> Watch the webinar now