SWIFT launched Alliance Lite in 2008 as a cheap option for customers with low volume traffic requirements. The system's interface uses a standard Internet connection with a SWIFT-issued hardware security token, which can be provided on a USB memory stick. Once activated, corporate users send payment instructions via Swift to their financial institutions in whatever format they want.
The cloud-based Alliance Lite2 will make SWIFT-hosted connectivity possible for far more customers by supporting much higher message volumes, all formats (MT and MX), and more automation options. Customers will no longer need to maintain SWIFT equipment onsite, with a USB token the only hardware required.
Alliance Lite2 will also be offered to existing customers as a fall-back option, this is the critical difference from Alliance Lite1. SWIFT and many others have become increasingly concerned that the biggest operational risk in many corporate treasury departments is their complete reliance on their SWIFT service bureau for their connectivity. There is no concern about the large SWIFT service bureau with multiple centres and backup routes, it is the smaller service bureau that is putting SWIFT's overall service at risk. They felt they had to offer the 500 corporate users some form of backup.
Pilot testing is scheduled to begin in April, with the go-live date set for July.
The importance of operational risk in corporate treasury departments is growing as they reduce the number of banks, payment options and technology suppliers. Expect 1) more backup solutions to cover operational counter-party risk and 2) that these will come from unlikely sources.
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