Swift pilots API-based pre-validation service to cut payment errors

Swift pilots API-based pre-validation service to cut payment errors

Swift has signed 14 major banks - including Bank of China, Citi and Deutsche Bank - to a pilot using APIs to pre-validate gpi payments, speeding up identification and cutting out errors and omissions in messages.

Errors in payment data, such as incorrect or missing beneficiary or incomplete regulatory information are still relatively common, holding up transactions.

This means not all payments get the full benefits of Swift's gpi (global payments innovation) scheme, which promises same day end-to-end delivery with full tracking and transparency throughout the payment chain.

Swift's answer is the pre-validation scheme, which is fully integrated with gpi payments. The pilot will enable sending banks to send and receive API calls over Swift to seamlessly check beneficiary account information with the ultimate receiving banks.

Banks can then quickly fix any inaccurate or missing information, reducing delays and costs.

Luc Meurant, chief marketing officer, Swift, says: "Swift gpi has already created a fast and frictionless cross-border payment experience for many banks and corporates - but we know that there are still payments which can be sped up further by ensuring the correct information is provided at the start.

"By embedding this new capability in the same payment messaging channel, thousands of banks will benefit from the resulting efficiencies, thus boosting the financial services industry as a whole as we move toward universal implementation of gpi in 2020."

Bank of America Merrill Lynch, Bank of China, Barclays, BBVA, BNP Paribas, Citi, Deutsche Bank, E.SUN Commercial Bank, ICBC, JP Morgan, National Australia Bank, Piraeus Bank, Societe Generale and Wells Fargo are onboard for the pilot, which should lead to a roll out all 10,000 Swift bank members.

Swift is also planning a complementary post-payment investigation and reconciliation service that will allow for fast resolution of the remaining factors, typically arising from compliance or regulatory requirements, which can slow down the payments process.

Manish Kohli, global head, payments and receivables, Citi Treasury and Trade Solutions, says: "This service is an enabler of our goal to provide real-time ubiquitous cross border payments by allowing banks and our clients to rectify any issues at the point of origination, achieving seamless end-to-end fulfilment along the payments delivery chain."
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Comments: (1)

Enrico Camerinelli
Enrico Camerinelli - Aite Group - Boston 11 December, 2018, 18:39Be the first to give this comment the thumbs up 0 likes


SWIFT’s API-based pre-validation service

 

The pre-validation scheme is fully integrated with SWIFT gpi (global payments initiative) payments and will enable a bank to send and receive application programming interface (API) calls over the SWIFT network to check beneficiary account information with the ultimate receiving bank.

 

 

So what?

The relevant part of this news is the use of APIs as real-time bank-to-bank connectivity channels. Additional features to existing solutions will not be any more “patched” (i.e., hard-coded) to the solution but will come as external modules, reusable also for purposes that may arise in the future.

The use of APIs as enablers of added-value services for bank-to-bank interactions is an established practice for wholesale banks. Testament of this assertion is SWIFT’s declared plan to develop another API to run a post-payment investigation and reconciliation service that will allow for fast resolution of delaying factors typically arising from compliance or regulatory requirements.

 

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