SWIFT’s gpi Digital Messaging Service Reaches Milestone. Will Bank Clients Partake of the Benefits?

If your company is experiencing faster cross-border processing of payables and receivables these days, you may have SWIFT’s new gpi (global payments innovation) platform to thank.

SWIFT, the member-owned banking cooperative that provides financial messaging services, is now sending 25% of all cross-border payment traffic via gpi, as more than 165 banks signed up for the gpi service since its introduction 15 months ago..

“To date, 50 million gpi payments have been processed, with hundreds of thousands of payments sent daily across 350 country corridors in more than 100 currencies,” says SWIFT in a media release. “In major corridors, such as USA-China, gpi already accounts for more than 40% of payment traffic.”

New standard

SWIFT expects gpi to become the “standard for all cross-border payments made on the SWIFT network by the end of 2020,” replacing the current messaging service. SWIFT claims gpi, which leverages on digital technology, is much faster than the current platform.

According to SWIFT, gpi enables banks to credit payments to international beneficiaries in minutes or even seconds, track payments end-to-end in real-time, provide transparency over bank fees charged and FX rates applied, and deliver full visibility, thus optimizing client liquidity.

“As a truly global, fast, secure and transparent cross-border service, gpi is delivering real and tangible change, and the increase in its use is testament to the huge benefits it delivers to end customers,” claims Philippe Dirckx, SWIFT Managing Director for Asia Pacific.

Will bank clients share in the gains?

In March this year, SWIFT announced the extension of its gpi Tracker to cover all payment instructions sent across the network, enabling gpi banks to track all their SWIFT payment instructions at all times, and giving them full visibility over all their payments activity.

As a direct result of the speed and transparency afforded by gpi, banks using the service have seen a significant reduction in frictions and as much as a 50% fall in the banks’ enquiry costs, says SWIFT.

It remains to be seen whether the banks’ will pass on the savings from the “dramatic enhancements and efficiencies” in terms of fee reductions to clients or whether they will give clients access to gpi Tracker.

In a previous interview with CFO Innovation, Dirckx said the tracker “is accessible via API, so banks could integrate the tracker into their applications. They could provide additional services to their client such as the status of incoming payments.”

But “It will depend on what the bank connected to SWIFT is willing or able to share with and offer to the corporate,” he added.

It may be that CFOs and treasurers will need to be proactive and ask their banks what their new capabilities are on the gpi service and negotiate additional services – along with fee reductions.