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SWIFT: new service bureau in India and report RMB’s global decline continues

SWIFT’s three recent announcements show how critically important they are to the global economy, and the efficiency of global systems and services.

Extending India coverage

SWIFT India have announced they are using Marketplace Technologies Pvt. Ltd (Marketplace), a 100 % subsidiary of the Bombay Stock Exchange (BSE) to act as its Service Bureau for securities markets in India providing a standardised, cost-effective, robust and secured infrastructure to all market participants.

As the Indian regulators are encouraging the adoption of global messaging standards like ISO 20022 to bring operational efficiency in Indian securities market, the partnership with Marketplace is expected to provide easy access to industry players like asset management companies, broker dealers to connect to SWIFT India network which will help securities participants to automate and standardise their communication including areas but not limited to investment account management, fixed income trade settlement & trade reporting, investment funds subscription & redemption which will bring operational efficiency and reduce risk.

Supporting asset management companies (AMC) with their investment cash management activities will be the first flows to go live in November and will be accessible to other securities participants like insurance companies, broker dealers, depositories and custodians.

RMB usage declines

SWIFT tracker shows the RMB share falling from 1.85 per cent in September to just 1.46 per cent last month, its lowest level since April 2014 which means that the currency’s share has nearly halved since its peak in 2015.

Some experts feel that the RMB is less relevant in international markets. Sue Trinh of RBC Capital Markets was quoted in the Financial Times it was down to “heavy handed intervention across the financial markets.”

Leveraging international standards to unify emerging financial technologies

SWIFT have released a discussion paper on the use of the financial messaging standard ISO 20022 for unifying FinTech. New technologies have been proliferating in the last decade and are already transforming conventional banking systems as FinTechs and banks are working together to co-create the financial landscape of tomorrow. However FinTech innovation comes in different shapes and sizes and without the adoption of common standards, the use of divergent technologies could lead to inefficient and ineffective fragmentation.

SWIFT, the Registration Authority for ISO 20022, is working closely with the industry globally to standardise messaging and best practices. This new discussion paper captured the opinions on the use of the standard in the context of established technologies such as RTGS and CSD systems, as well as new technological innovations such as contactless and mobile protocols, DLT and APIs.

CTMfile take: Talk of replacing SWIFT is just silly, they have a crucial role in so many different aspects of the global economy. Need to evolve and improve? Of course.

This item appears in the following sections:
SWIFT Corporate Connectivity
Investing Short-Medium Term Surpluses
Cash & Liquidity Management in Asia-Pacific

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