Bank-to-bank messaging network Swift has moved to eliminate payments friction by introducing a new capability to flag upfront when a payment may stall because of incorrect payee details,
The new service analyses previous flows on the Swift network to identify accounts that have been credited successfully and uses this information to detect potential errors in payee information - the most common cause of cross-border delays.
This centralised verification, based on aggregated and anonymised data from nine billion transaction messages between four billion accounts each year, provides a level of insight no single financial institution has on its own.
“Think of it as the ultimate payment pre-check” says Thomas Zschach, chief innovation officer, Swift. “When someone wants to make an international payment, we can instantly predict the likelihood of success based on whether the account has been credited successfully in the past, and then present this information directly to the customer so that they can fix any errors or typos before the payment even starts its processing.”
The new capability is an expanded feature of Swift’s Payment Pre-validation service and is available to banks via an API.
Vijay Lulla, director, payments products, HSBC comments: “HSBC is an early adopter of Sswift’s Payment Pre-validation service and sees it as an important step in removing friction from cross-border payments by providing the capability to detect and prevent any issues before a transaction is completed. This provides our customers with a solution that helps to minimise the risk of payment delays.”