Wednesday, September 20, 2006

Let's TWIST again

This week in the bowels of the BT Tower in London,TWIST staked its claim to be the standards setting body of the 21st century for financial services. Some of you may remember TWIST as an organisation originally developed by large corporate treasuries such as Royal Dutch Shell to set standards for fostering higher levels of straight-through processing and automation in the area of FX.

Well, TWIST's ambitions these days are not just confined to FX. Ex-SWIFT standards guru Peter Guldentops, now programme director at TWIST, outlined how the organisation's ambitions had grown to include: financial supply chain standards (collaboration, invoicing and shipping finance),SEPA-compliant payments standards,bank billing standards and portability of digital identities.

"More open markets, more open standards," was the mantra espoused by TWIST chairman Tom Buschman. With the whiff of a Thai military coup fresh in my mind, the more I contemplated it,the more I concluded TWIST + ex-SWIFT standards guru + global IP network BT Radianz (who kindly allowed TWIST the use of the BT Tower) = challenge to SWIFT

Put TWIST's"open" standards on BT Radianz's networks (or SWIFT's for that matter) and et voila you have what Buschman terms "plug and play". There is nothing to say these standards could not be used on the SWIFT network, however, as SWIFT is a bank-owned network and also considers itself to be a major standards setting body in the realm of financial services, will it see TWIST's ambitions as a disparate initiative that could cause market fragmentation instead of standardisation?

The message from Buschman is clear; banks' revenues are significantly challenged by what is happening in the payments market, and "there is still a lot of talk and no action", particularly around initiatives such as the Single Euro Payments Area (SEPA). So if banks don't get their act together, corporates working through organisations like TWIST will.

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