SWIFT is making good progress in signing up corporates for direct connection to SWIFT. There are now 1350 corporate groups connected to SWIFT:
- 10% direct - very large corporates
- 40% via Alliance Lite2
- 50% via service bureaux.
Annual growth rate is about 15%.
Several TMS and other service providers have embedded Alliance Lite2 as part of their service:
- AccessPay - http://www.accesspay.com/
- OpusCapita - http://www.opuscapita.com/
- ECS Financial - http://ecsfinancial.com/
- Bellin - http://www.bellin.de/en/1_index.html
- Treasury Intelligence Solutions - http://www.tis.biz/de/
- Kyriba - http://www.kyriba.com/
- UnifiedPost - http://www.unifiedpost.com/
- GTreasury - http://www.gtreasury.com/
- Alliance Enterprise - http://www.alliensoft.com/.
This is changing the corporate-to-bank landscape as it makes it much easier for more corporates to connect to SWIFT.
Connecting to banks
Each corporate connected to SWIFT needs to set up the connectivity to each their banks in their internal systems or TMS, adopting the banks’ formats and protocols. Huge and very powerful large corporates just tell their banks, “This is the message formats we use. Accept it or we change banks.” Johnson Controls is a good example, see. But most corporates will have to adapt the formats of their messages for each bank.
The message format differences between banks and the changes that corporates have to make is a major issue. SWIFT are trying to get the banks to standardise much more. It is as, Andre Casterman SWIFT’s Head of Corporate and Supply Chain Markets, says, “A top issue.” But he feels it is just a cost of automation if the corporates want to automate the whole process and data flows. In the longer run the CGI and other initiatives to standardise the market practices on top of the ISO 20022 will make this process a lot simpler.
Many of the remaining differences between the banks are documented in the MyStandards repository which makes it easier to identify where the differences are, see. But middleware will probably also be needed to ensure complete compatibility in the corporate-to-bank space.
SAP’s Financial Services Network and SWIFT
SWIFT regards SAP’s FSN as another cloud-based connectivity model focusing on linking the corporate ERPs with their banks. Casterman believes that, “The challenge for corporates is to reach all those banks where SWIFT is already strong. We need to look at how we can combine the strengths of SWIFT and SAP for the benefit of the overall corporate market. Our ambition is to work with all the business networks, e.g. Ariba, Basware and Alibaba, that are digitising the corporate-to-corporate flows not only on the retail side, but also on the B2B side too. What we can offer is connectivity to the banks. We need to combine these platforms.”