Swift and banks in AI pilots to tackle cross-border payments fraud

Swift has announced two AI-based experiments in collaboration with its member banks to explore how the technology could help combat cross-border payments fraud and save the industry billions in fraud-related costs.

In the first pilot, Swift is enhancing its existing Payment Controls service – which helps financial institutions detect anomalies that could be indicative of fraud – by using an AI model that will create a more nuanced and accurate picture of potential fraud activity, using historical patterns of activity on the Swift network. Swift will work with Payment Controls customers to refine the enhancement, and the test will use the customers’ own live traffic data – giving the findings real-world applicability.

In a separate experiment, Swift has convened 10 financial institutions to test how it can use advanced AI technology to analyse anonymously shared data from different sources in a way that will strengthen the global financial ecosystem. Swift said that AI’s capability for confidential data sharing could be a game-changer for the industry. The tests could lead to the wider use of information sharing in fraud detection, building on its success in assessing cybersecurity threats.

The group, which includes banks such as BNY Mellon, Deutsche Bank, DNB, HSBC, Intesa Sanpaolo, and Standard Bank, will test the use of secure data collaboration and federated learning technologies. It will leverage a secure infrastructure, enabling financial institutions to exchange relevant information with strong privacy-preserving controls. Swift’s AI anomaly detection model will then be able to gather insights and identify potential fraud patterns from a much richer dataset.

“AI has great potential to significantly reduce fraud in the financial industry,” said Tom Zschach, Chief Innovation Officer at Swift. “That’s an incredibly exciting prospect, but one that will require strong collaboration.” 

 

73% of businesses struggle with payment delays

A staggering 73% of businesses in high-opportunity industries grapple with payment delays ranging from 2 to 15 days, hindering cash flow, according to the ‘2024 State of Payments: High-Opportunity Industries’ report from Rapyd. As a result, speed and convenience remain the top payment priorities. Some 38% of businesses surveyed prioritise fast and easy transfers, highlighting the need for solutions that address speed and reliability.

Nearly half (45%) of these businesses struggle with cash flow due to payment delays, according to the report. This underscores the urgency for faster payment solutions, with many companies (32%) seeking a simple integration process alongside swift transactions.

Beyond speed and convenience, the report finds that authorisation rates remain a concern for many businesses. A select group of businesses state that improved authorisation rates matter, with 1 in 6 firms wanting their payment provider to offer solutions that minimise declined transactions. With 25% of companies citing it as a critical factor, robust fraud management is essential. 

Some 38% of businesses surveyed anticipate a spike in RTP adoption in the next 12 months. RTP offers significant advantages over traditional methods, with faster settlement times leading to improved cash flow and wider access to capital. As David Rosa, Rapyd’s General Manager of Disburse, pointed out, “Payment delays are a significant pain point for both B2B and B2C businesses, with 26% reporting them as a major challenge. Real-time payments and payouts can significantly improve the payment experience for a variety of high-opportunity industries that need to collect and send payments to businesses and consumers.”

Rapyd conducted the global research study by surveying more than 1,000 business owners and payment decision-makers from various high-opportunity industries across ten markets: Brazil, Canada, France, Germany, Italy, the Netherlands, Spain, Singapore, the UK and the US. 

 

Swedbank sets climate target for shipping portfolio

Swedbank has adopted a climate target for its shipping portfolio to integrate climate considerations into the bank’s loan decisions for ship finance. The new target means that, by 2030, the financed emission intensity of Swedbank’s shipping portfolio will be aligned with the most ambitious decarbonisation pathway of the International Maritime Organization (IMO).  

In February, Swedbank signed the Poseidon Principles, a global framework for integrating climate considerations into loan decisions for ship finance. As a next step, the bank has adopted a climate target for its shipping portfolio, adding to the list of sectors in which the bank already measures financed emissions and have set climate targets.

The new target entails that, by 2030, Swedbank’s shipping portfolio shall be aligned with the IMO’s most ambitious decarbonisation pathway. This will mean that the portfolio's average emission intensity will be approximately halved compared with the 2022 baseline. Swedbank has already set an overall emission target to reach net zero by 2050. 

The target applies to Swedbank’s lending to vessels covered by the Poseidon Principles, corresponding to vessels 5,000 gross tonnage and above. As part of its work to set the new target, Swedbank has produced a methodology paper that describes the bank’s selection criteria for adopting sector-specific climate targets and explains how the bank will work towards achieving the targets. 

“Swedbank continues to strengthen its sustainability commitment by adopting additional climate targets,” said Johanna Fager Wettergren, Head of Group Sustainability at Swedbank. “Shipping is the sixth sector in which we measure and set targets for our climate footprint. Collectively, these goals cover about 80% of our lending portfolio. Together with our customers, we continue to accelerate the transition.”

 

GTreasury adds BMO to its global bank API connectivity suite

GTreasury has announced that its ClearConnect Gateway - a global bank API connectivity suite - has launched a new instant financial data integration with BMO.

The API integration, powered by ClearConnect Gateway, enables BMO corporate customers to access current-day balance and transaction reporting and prior-day balance and reporting. The solution should provide treasury teams and CFOs with enhanced levels of data availability and accuracy of mission-critical financial data.

BMO joins GTreasury’s list of ClearConnect Gateway data connectivity integrations for balance and transaction reporting, which also includes Bank of America, Barclays, Citibank, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan Chase, PNC, U.S. Bank, and Wells Fargo.

ClearConnect Gateway replaces enterprises’ pre-existing banking connections with out-of-the-box API connectivity and data integration into their preferred banking partners. The solution is designed to let treasury teams quickly use API connectivity for real-time synchronisation with banks, ERPs, and third-party platforms.

 

CBA to pilot international use of account confirmation tool on Liink by J.P.Morgan

Commonwealth Bank of Australia (CBA) says it will be the first Australian bank to help validate bank account details used in international payments to Australia by enabling its NameCheck technology on Liink by J.P.Morgan.

Liink by J.P. Morgan is a network that facilitates secure and private peer-to-peer information and capability exchange between global financial services organisations such as banks, credit unions, fintechs, and digital banks. Confirm, an application on Liink by J.P. Morgan, is designed for the exchange of global account validation information. This network was developed by J.P. Morgan’s blockchain business unit Onyx.

CBA is looking to pilot sharing limited payee account data through its NameCheck technology, on the Liink network. CBA’s NameCheck applies advanced technology and the bank's available payment data to give an indication of whether the account details provided look right. The bank made the solution available to its retail and business customers in 2023 and is progressively rolling it out to further payment types and scenarios. CBA has also since made its NameCheck technology available to external organisations via API in a bid to protect more people and businesses from scams and mistaken payments.

“Scams are a significant threat to customers and businesses not just here in Australia, but globally,” commented Mike Vacy-Lyle, Group Executive Business Banking, CBA. “We firmly believe a coordinated, whole-of-ecosystem approach is required across institutions operating in various sectors and jurisdictions. Our move to pilot our NameCheck technology on Liink by J.P.Morgan is a big step forward in addressing the impact of scams.”

 

Framework proposed to advance adoption of digital assets

Three of the world’s largest financial market infrastructures (FMIs) – DTCC, Clearstream, and Euroclear – in collaboration with Boston Consulting Group (BCG), have unveiled a blueprint for establishing an industry-wide digital asset ecosystem to drive acceptance of tokenised assets.

By 2030, the tokenisation of global illiquid assets is projected to be a US$16 trillion business opportunity. However, progress on institutional adoption has reached an inflexion point as firms continue innovating in silos, with small-scale initiatives that fail to progress or prioritise broad ecosystem development. The paper, ‘Building the Digital Asset Ecosystem’, looks to shift the industry’s focus by defining six principles to promote the successful adoption of tokenisation and digital asset securities (excluding cryptocurrencies). It also details a comprehensive set of risk management controls to underpin the future of digital markets.

The six principles, intended to serve as a roadmap for the industry to come together and develop comprehensive standards for the digital asset marketplace, include:

• Legal certainty – ensuring operations comply with the law.
• Regulatory compliance – encouraging alignment with regulatory frameworks.
• Resilience and security – developing robust infrastructure capable of resisting disruptions while protecting sensitive data.
• Safeguarding customer assets – implementing governance via smart contracts to manage assets securely.
• Connectivity and interoperability – facilitating transactions and flexible settlements across diverse networks.
• Operational scalability – striving for efficiency and cost-effectiveness through standardisation.

In addition to the six core principles, the paper presents a list of controls to help firms mitigate risks such as asset mismanagement or insufficient controls to govern smart contracts. Recommended controls include defining who can access smart contracts and maintaining a comprehensive record of digital asset events/transactions.

The FMIs collaborated with BCG, which conducted an analysis including reviews of approximately 100 regulations and whitepapers across multiple jurisdictions, and over 20 interviews with market participants and technology vendors.

 

Citizens launches cash flow forecasting solution for businesses

Small business owners will be able to forecast their cash flow up to 12 months in advance using a digital solution rolled out by Citizens. The solution, Citizens Cash Flow Forecasting, offers tips and insights as well as competitive benchmarking designed to enable business owners to compare their company to similar businesses based on geography, revenue, and employee count.

It will be available to customers using Citizens Cash Flow Essentials, an online and mobile cash management platform launched in 2023. Cash Flow Forecasting joins Citizens’ suite of digital resources for small business owners, including Digital Account Opening, Zelle for small businesses and mobile deposit.

The solution aims to meet a critical need highlighted in the recently released Citizens 2024 Business Outlook Survey, which found that more than half of small and mid-size business owners (55%) view improving insight into company cash flow as a top priority in 2024.

Citizens’ survey of 600 principals at small and mid-size businesses in the US (up to US$25m in annual revenue) reveals several advantages to consolidating cash flow tools. In fact, respondents who have consolidated their cash flow applications reported benefits including increased profitability (44%), increased productivity (43%) and lower costs (42%).

The survey, conducted in February, found that companies leaning heavily on insights and advice expect to have a competitive edge over their peers. In fact, 87% of “insight-driven” businesses – respondents with more than US$500,000 in annual revenue that tap into financial tools and expert advice at least weekly – anticipate fast expansion in the year ahead and 72% have growth-focused five-year plans. Nearly nine out of every ten (88%) of these businesses also report having an “extremely or very good” understanding of company cash flow.

 

Mastercard opens cyber resilience centre in Belgium

Mastercard has announced the opening of its European Cyber Resilience Centre (ECRC) at its European Headquarters, reaffirming the company’s commitment to combatting cyber threats and enhancing resilience in the region. The new centre aims to sharpen defences against cyber threats, speed up response times and serve as a hub for thought leadership in cybersecurity, fostering collaboration between the public and private sectors.

With continuous digitisation and unprecedented levels of connectivity, cybercrime presents a shared challenge across all organisations. Fraudsters are using technology in more innovative and sophisticated ways to try and harm consumers and businesses – this problem is only growing. Cybercrime has become a global economy now estimated to be worth trillions of euros.

To address this ever-evolving threat landscape, the ECRC brings together partners from across the public and private sectors. By leveraging its facilities and diverse talent pool, it facilitates collaboration with national cyber intelligence centres, law enforcement agencies, and industry bodies across Europe.

The Centre bolsters Mastercard’s ability to combat cyber threats across the digital ecosystem and helps it protect, detect, and respond to attacks. It fosters deeper connections with customers, partners, and stakeholders and drives collaboration across the region, enhancing resilience. It includes a Fusion Centre, the heart of Mastercard’s organisational incident response, and a Digital Forensics Lab, in addition to representatives from more than 20 teams - all crucial to running an effective Resilience Centre.