tag:blogger.com,1999:blog-32713407.post7649022113643950189..comments2023-10-26T11:08:43.871+01:00Comments on FinancialTech Insider: SWIFT misses open standards opportunityFinancialTech Insiderhttp://www.blogger.com/profile/10688549571379138620noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-32713407.post-21302738570660405532008-10-22T16:07:00.000+01:002008-10-22T16:07:00.000+01:00When you talk about ISO 20022 you have to be caref...When you talk about ISO 20022 you have to be careful what you say. ISO 20022 covers four business domains within the financial industry and within this it covers many processes. It also being extended to cover even more. <BR/><BR/>Some of the messages are designed to cover new processes and other are designed to replace (or co-exist with) existing messages.<BR/><BR/>You can’t put all these messages in to the same bucket and generically talk about whether ISO 20022 is good or bad, worth it or not, and whether it is succeeding or not. You have to be more specific.<BR/><BR/>At SIBOS, SWIFT did lot of promotion around the new ISO formats, at least that was my impression. I was present in several sessions where the new ISO 20022 formats were the main subject or it was brought up during the session. Furthermore, I had meetings with SWIFT to work out how together – Wallstreet and Swift – we can better plan for new formats in the future, as well as to update SWIFT about our thoughts and strategy.<BR/><BR/>I agree with Financial Insights that ISO is a ’leading candidate for standardisation of corporate-to-bank messaging‘. I would add that it is the only candidate for global standardisation. All major banks today have experience with ISO 20022 format due to fact that SEPA payments have to use this in the bank-to-bank space. Therefore it should be easy for the banks to offer this format to corporates.<BR/><BR/>Banks are most likely rather ambivalent about the standardisation of corporate-to-bank interfaces. There are probably different voices and views within the same bank depending on which department you’re in. Standardisation gives the corporates lower costs when they want to change banks and therefore encourage them to change bank more often. On the other hand, it will lower the marginal cost of adding another bank, so they may simply initiate more bank relationships. <BR/><BR/>Daimler has been using SWIFT connectivity for several years with its major banks and plans to expand it to all banks. Volkmar Lorenz from Daimler said during SIBOS that since they have started their SWIFT connectivity project, Daimler has not stopped working with any of the banks they communicate with via SWIFT.<BR/><BR/>However, we should not expect a revolution. The ISO 20022 format will slowly be used more and more in the C2B space when corporates renew their interfaces to the banks because they change bank or upgrade the system. Few companies will change to the new format for the sake of the new format, but will wait until they have to test the interface anyway.<BR/><BR/>Finally, switching to SWIFTNet connectivity for C2B communication will accelerate the usage of the format. We will see European companies being front runners, but the usage will spread to other parts of the world over the years.<BR/><BR/>Joergen Jensen<BR/>Director, Corporate Solutions<BR/>Wall Street SystemsAnonymousnoreply@blogger.com