Some readers may recall the SWIFT announcement last year of a strategic shift in direction to expand beyond financial messaging into a range of transaction management services for member banks. The idea is to roll out the new capabilities over a two year period, including new and extensive data capabilities for pre-validation of essential data, fraud detection, data analytics, transaction tracking and exception case management.
These are things banks will handle themselves through vendors and in some cases internally developed solutions, so fall into the category of SWIFT value-add services. In this referenced posting at International Banker, a SWIFT senior discusses some of these added capabilities, such as SWIFT Payment Controls.
‘Ensuring the correspondent-banking industry continues to have the tightest controls and most efficient tools to detect and prevent illegal use of the financial system remains a top priority. As we move towards compliance in a real-time world, concerns such as anti-money laundering (AML), know your customer (KYC) and sanctions will become even more challenging. More than ever before, compliance teams need to make difficult decisions within a shorter timeframe, and it is important to remove as much human error from the equation as possible….The increasing volume of alerts, along with the complexity and workloads that compliance teams face, can create problems keeping up, leading to delays, lost business and sometimes even costly regulatory penalties. The good news is we have already made huge strides. Services, technologies and initiatives such as the SWIFT gpi standard, APIs (application programming interfaces) and ISO 20022 (International Organization for Standardization’s [ISO’s] Standard 20022) are already transforming the industry. And more is to come….For example, with the gpi standard, banks sending data over the SWIFT (Society for Worldwide Interbank Financial Telecommunication) network can pre-validate the beneficiary account information with the ultimate receiving bank, thus minimising further the risk of payments ending up in the wrong account.’
As we have stated consistently, the whole effort is to support the growing demand for better cross-border experiences, where banks have had a dominant role in the B2B space. With all the new x-border products, services and rails popping up, the SWIFT move is a logical one to stay in the mix as a primary support structure for thousands of member banks.
‘We will do this by transforming the SWIFT platform based on the concept of transaction management. Retaining SWIFT messaging, the platform goes way beyond today’s capabilities to orchestrate fast and frictionless end-to-end transactions while maintaining SWIFT’s hallmark focus on resiliency and security. SWIFT’s platform will help remove compliance delays by maintaining full transaction data at the centre and ensure end-to-end transaction integrity….The platform will provide a set of common transaction-processing services, such as pre-validation of essential data, fraud detection, data analytics, transaction tracking and exception-case management. And we will continue to work with our community to further offer compliance support, leverage rich data and improve end-to-end efficiency. Furthermore, improved data quality, along with advanced analytics and insights, will pave the way for financial institutions to offer new value-added services and enhance the end-customer experience.’
