The move to ISO 20022 payment message standard is really significant and it comes at a time when payment systems are changing very rapidly indeed.
It’s all coming together at the same time
Christian Westerhaus, Head of Cash Products, Cash Management, Global Transaction Banking, Deutsche Bank points out that:
- This is the watershed moment for the industry. Over the next five years, the world’s primary payment market infrastructures (PMIs) will undergo huge transformational change in response to demands for increased automation and cost efficiencies, enhanced market integration and real-time services. Not only that:
- major PMIs such as the Federal Reserve and The Clearing House (US), Eurosystem and EBA Clearing (Eurozone) and the Bank of England’s RTGS (UK) will all modernise their High-Value Payment Systems (HVPS), almost simultaneously
- Underpinning each of those modernisation programs is the migration to ISO 20022.
Dr Hubertus von Poser, Head of Consulting Payments, PPI AG, Deutsche Bank’s partner in this white paper reminds banks that: “While ISO 20022 migration may at first appear to be technical and abstract, it will have far-reaching implications for banks’ payment systems and processes.”
Crucial role of the ISO 20022 standard
The report stresses that “International payments is a global network business in which at least three (although usually more) parties are involved. It goes without saying that harmonised standards and rules for the exchange of payment messages and data are therefore of paramount importance.”
The significance of ISO 20022 migration is dealt with in detail and why the change is needed and the opportunities and benefits.
What does ISO 20022 means for banks
Significant and complex internal changes are on the horizon for banks. It is crucial, therefore, that senior management are aware of the magnitude of the project in terms of resources and budget, as well as the need to secure appropriate prioritisation with existing external vendors, e.g. Impact of moving to ISO ISO 20022 XML formats
The report reviews how the global market infrastructure is changing and how ISO 20022 will be rolled out in the future.
CTMfile take: This report is a must-read for banks to understand what will be involved in this major change to payment systems infrastructure and processes worldwide.
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