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SWIFT transformation, part 2: Transition to a transaction platform timeline

In the first article of the series, we reviewed the history of messaging on the SWIFT platform in broad categories and described the movement from a linear messaging process to a transaction platform. We examined several key impacts to message resiliency, the quality of data, and the ability to offer other services as an extension of the platform. This article looks at the future timeline at a granular level and examines some of the service extensions that are possible on a transaction platform.

Detailed timeline

The timeline shows a set of added-value services that are being rolled out on the payment platform. The flexibility of the transaction platform allows for multiple value streams to run concurrently as they progress through pilot to full adoption of network participants. More information on this can be located on swift.com.

Source & Copyright©2021 - CTMfile/Strategic Treasurer. Data summarized from SWIFT publications and conversations.

Services

There are multiple services at various stages of development, piloting and rollout. The nearby graphic shows the conceptual timelines for several of these services.

  • Live
    • Transaction Tracking. This service is already live for SWIFT gpi (global payments initiative). Each gpi transaction has a unique tracking number (called a UETR) that is visible to all relevant parties throughout the payment process. At every stage of the transaction lifecycle, each participant has visibility to the ‘location’ and status of the transaction as the platform is updated with each movement or change. Near instantaneous reporting and visibility.
  • Pilot
    • Sanction Screening. Financial Crime Compliance (FCC) sanction screening provides an embedded service within the platform to keep your organization in compliance more gracefully. Fighting the funding of terrorism through sanction screening is a requirement in nearly every jurisdiction. The activities surrounding the screening process are handled by companies on a payment system by payment system basis. Now they can be handled by a centralized and integrated SWIFT service. The FCC embedded service allows SWIFT users to ‘turn on’ transaction screening at a network level (at SWIFT) to ensure proper compliance for every payment running over the platform.
    • Pre-Validation of Banking Information. Making payments with incorrect account information can be the result of fraudulent activity or of processing errors. Pre-validation is a method of checking the account information of your payment beneficiaries with the beneficiary’s institution before you send the payment instructions. By validating this information before a payment is sent, incomplete or inaccurate data can be fixed before a transaction is launched, avoiding the costly error/resolution process.

New services on a new platform

New services on the platform are originated with APIs through the SWIFT transaction platform. For pre-validation, an institution can originate an API call and receive the information they need in real-time. This reduces costs, delays and customer frustration.

Expectations for information, payments and services increase with personal banking and corporate banking. Corporate treasurers and payment professionals expect speed and efficiency. Stephen Lindsay, Business Lead, SWIFT Platform, comments on these core expectations: “Payments today need to be instant and frictionless – with complete transparency from end to end.” Older messaging platforms need to be changed to leverage new technology. Stephen continues, “That’s why we’re transforming the SWIFT platform to enable financial institutions to deliver just that, from account to account, anywhere in the world.”

Extending the power of a network

The transformation to a transaction platform allows for a rich range of services to be more easily added into the network suite of services. Mr. Lindsay indicates that these new services are possible and many of them are already inflight from piloting to the go-live track. The rapid rollout of these services is made possible via “… centralised transaction orchestration, including payment pre-validation, sanctions screening, anomaly detection, transaction tracking, exception case management solutions and more – our platform is the foundation for the next generation of payment services.”  These new services are deployed through the use of API calls through the SWIFT transaction platform.

The addition of other services adds to the value of the SWIFT platform. The ability to further enrich the transaction process easily represents a significant strategic play for network participants and their counterparties.


CTMfile take: Great strategy, continual execution and communication must all be performed in concert in order for SWIFT to continue its historical position of strength. The power of a network is derived from the size of the network and what you can do on it. The new transaction platform model holds promise of additional value but requires that their target audience understands what this means as it competes against loud voices in the transaction space.

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