SWIFT Creates Task Force to Facilitate Global Rollout of ISO 20022

Following the launch of the ISO 20022 Harmonisation Charter, an industry-driven framework to facilitate the rollout of ISO 20022 globally, SWIFT has formed a global market practice task force of markets infrastructures and banks.

ISO 20022, the universal financial industry message scheme, aims to give the financial industry a standard platform for the development of messages in one eXtensible Markup Language (XML) rule.

An appealing advantage of ISO 20022 is the improved straight through processing (STP), the automatic processing of an order without human intervention. Because the entire chain uses a uniform format for payments, processing time will be shorter and the likelihood of errors is lower. All parties, including corporates, in the chain are expected to benefit from this.

Sponsored by the Payments Market Practice Group (PMPG), the task force aims to address the evolving ISO 20022 standards requirements of high value payments systems (HVPS) providers. It is a key component of SWIFT’s ISO 20022 harmonisation initiative that aims to address the industry concern around fragmentation and the risk of multiple versions and flavours being adopted across various markets, leading to higher implementation costs.

Focus on interoparability

The new task force, called HVPS+, will build on the existing HVPS market practice documented in MyStandards that focuses on ensuring interoperability with FIN messages in the cross-border space.

The new group, which goes beyond current market practice, will deliver an additional set of ISO 20022 market practice guidelines for high value payments systems, taking into account the evolving needs of market infrastructures and their members, including more structured, accurate and richer end-to-end data. It creates a common foundation on which major payments market infrastructures can build their community implementations, whilst supporting global interoperability.

"From an industry perspective, this is a meaningful collaborative initiative that can benefit all market infrastructures and their members,” says Gina Russo, Federal Reserve Bank of New York. “By encouraging a standardised global approach to ISO 20022 implementation for high value payments systems, the industry as a whole can be in a position to reduce costs, ensure efficient implementation, and realize the true benefits of using a common global standard.”

“As HVPS providers around the globe are planning adoption of ISO 20022, the PMPG is committed to sponsoring this new initiative, helping to establish harmonised global market practice, which is imperative to reduce implementation costs and ensure straight-through processing for banks,” adds Rob Green, Head of Payments Market Infrastructure in Banking Group Treasury, FirstRand Bank and Director, SWIFT Board of Directors and co-chair, PMPG.

Roy DeCicco, Managing Director and Industry Issues Executive with Treasury Services at JPMorgan and co-chair, PMPG, says “It is great to see market infrastructures and banks join together, to ensure this additional set of ISO 20022 HVPS+ market practice is future-proof and supported by all relevant stakeholders of the financial ecosystem.”

Commenting on ISO 20022, Bob Pepitone, CHIPS Product Manager at The Clearing House, says “The Clearing House is adopting ISO 20022 as its preferred messaging standard for real-time and high-value payments. As we prepare our implementation strategy to convert our proprietary CHIPS format specifications to ISO 20022, we would like to use this new global market practice as a baseline. This will allow our members to use the same formats and processes with TCH and other HVP communities, while incorporating the unique characteristics of the CHIPS messaging formats. This approach will definitely help to enable interoperability for all payments market infrastructures globally.”

The following organisations are participating in the new HVPS+ task force (in alphabetical order): ABN AMRO, Australian Payments Clearing Association, Banca d’Italia, Bank of America Merrill Lynch, Bank of England, EBA Clearing, European Central Bank, Federal Reserve Bank of New York, FirstRand Bank Ltd, Hong Kong Interbank Clearing Limited, Payments Canada, Société Générale, Standard Bank, The Clearing House, and Wells Fargo.

The task force started work at the end of June 2016 and expects to publish a first set of additional market practice guidelines in MyStandards, SWIFT’s online platform for sharing standards information, in Q4 2016/Q1 2017.

 

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