Corporates crying out for remittance data - AFP
14 July 2009 | 4912 views | 2
US corporations are overwhelmingly supportive of bank moves to incorporate remittance information in wire transfers, according to a study by the Association for Financial Professionals.
Ninety-five percent of the 331 respondents to the AFP survey believe remittance information would be valuable to their organisations if it were made available in the wire transfer message.
The absence of supporting information in the past has hindered attempts to boost straight-through processing rates between bank cash management platforms and corporate treasury systems.
Both the public Fedwire Funds Service and privately-held Chips network have committed to expanding their messaging formats to provide remittance information with wire transfers by late 2010.
As the new format comes onstream, businesses will be able to accurately identify incoming payments and post them to the correct accounts without manual intervention and research.
The initiative is likely to boost wire transfer volumes, says AFP, steering companies away from alternative solutions and strengthening the ties between banks and their corporate customers.
The move is also expected to stimulate changes in corporate messaging flows. While 91% of wire transfer recipients - the main beneficiaries of remittance information - indicated they would use the new data to receive and post incoming wires, nearly two-thirds (61%) said they would include remittance information in outgoing wires, perhaps to reduce the number of inquiries from the receiver of the wire transfer.