As businesses have become more global and economies more intertwined, the volume of digital global payments has significantly increased and the requirements for payment processing have changed. To address the inefficiencies and limitations with current messaging standards, and to standardize payment message exchange across the world, the payments industry has introduced ISO 20022 – an enhanced global payments messaging standard. Although ISO 20022 has been around for a while now, key regulatory and industry drivers are accelerating the implementation internationally across market infrastructures and payments systems.
Who will be using ISO 20022?
Everyone! There are industry and regulatory driven initiatives underway across the whole of the payments industry. Follow-on changes are underway in securities, treasury, trade services, cards and FX.
Why ISO 20022?
- ISO 20022 is global
- Open standard for payments messaging
- Used in payment systems in over 70 countries
- Rich, structured Data Model
- Improves Compliance screening
- Enables new kinds of business
What will be impacted by ISO 20022?
- Inbound & Outbound messaging over InterAct/FinPlus
- Compliance Screening & Payment Reconciliation Processes
- Liquidity Management changes and processes
- Accounting platforms/Intermediary applications
- Downstream systems currently consuming underlying SWIFT MTs
- Downstream processes and teams who directly access CHAPS, T2 or SWIFT MT messages today in BAU
Read the full report (7 pages) in the attached PDF file
The ISO 20022 adoption is already in full swing, with countries such as Switzerland and China already mandating the use of the standard. Adoption strategies across financial institutions have varied and the correct strategy usually depends on the size and complexity of the problem at hand. The next 4-5 years are critical for financial institutions, as well as overall industry participants.
What is the right ISO strategy for your organization, will you seek to achieve compliance or will you look to capitalize on the adoption of ISO?
ISO journey to be continued, Part II, will be available shortly.