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SWIFT chiefs praise digital innovation

12th Oct 2021 by Graham Buck

The opening day of Sibos 2021 – as in 2020 an all-digital event – saw praise from the SWIFT cooperative for the way that companies and their employees have responded to the Covid-19 pandemic.

"Innovation is at an all-time high in the financial services industry and there is a profound sense of excitement,” said Yawar Shah, Chairman of the SWIFT Board in his opening address on the first day of the event. “There is tremendous demand in the marketplace for what we do, across payments and securities processing. The world changed in many ways because of Covid and, in our industry, one of the lasting
impacts is a quantum shift to digital.”

SWIFT gpi's transformation

SWIFT's CEO, Javier Pérez-Tasso agreed that the pandemic has seen everyone go digital in a big way in their daily lives, including working from home and using Zoom for meetings, and caused an “accelerated change in the business environment.

“It has really impressed me how the financial services industry as a whole has not just maintained business as usual, but has got great momentum in its own transformation”.

Pérez-Tasso added that SWIFT's global payments innovation (gpi) initiative, launched nearly firv years ago had been similarly revolutionary for high-value cross-border payments. “SWIFT has transformed the international payment experience," he said. “Almost half of all SWIFT payments are credited within five minutes, not just to the receiving bank but to end beneficiaries, and about two thirds within 30 minutes. The reality of this transformation is pretty telling.”

SWIFT Go the next step

Pérez-Tasso also referred to SWIFT's more recent progress in delivering new capabilities to help financial institutions increase efficiency and provide new value to their customers. “We have been delivering at pace,” he said. “This time last year, I talked about our plans to move beyond our traditional high-value segments to enable fast and competitive SME and consumer payments over SWIFT.

“Well, a couple of months ago we have made that happen with SWIFT Go, which is a real game changer. This means fast, transparent and cost-effective international payments and remittances with a simple click from banks’ own customer channels that forward-looking and agile institutions are able to implement today.”

Another recent innovation has been the introduction of a payment pre-validation servive so that financial institutions can check that data is correct before a payment is issued and ensuring a frictionless experience.

An enhanced platform

SWIFT next plans to introduce an enhanced platform in progressing towards its vision of enabling instant and frictionless payment transactions from account to account anywhere in the world.

“We are full speed ahead on our platform transformation," commented Pérez-Tasso. "Next year, we introduce a major deliverable in our journey with our new API-driven transaction manager that lies at the heart of our vision. And once [SWIFT's] Transaction Manager is in full force, when we promise instant, we will really deliver instant.”

The Transaction Manager will be currency agnostic, so that if the industry adopts central bank digital currencies (CBDCs) or stablecoins, SWIFT will facilitate interoperability between token-based and account-based networks.

Pérez-Tasso also covered the fast-approaching adoption of ISO 20022 and said that SWIFT is playing a leading role in facilitating a seamless transition to the standard in line with the industry’s agreed adoption timeframe through a three year coexistence period starting in November 2022. In-flow translation will be available for testing from next month, providing customers ample time for testing and ensuring everyone can migrate to ISO 20022 at their own pace.

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