On 5 April, SWIFT announced that 21 banks have started the pilot for its global payments innovation initiative, intended to improve the customer experience in correspondent banking by increasing the speed, transparency and predictability of cross-border payments.
The pilot is planned to run through to December, the first results of which will be shared at Sibos 2016 in Geneva this September. The banks participating in the pilot include: ANZ, Bank of America Merrill Lynch, Bank of China, Bank of New York Mellon, Bank of Tokyo-Mitsubishi UFJ, Barclays, BNP Paribas, Citi, Danske Bank, DBS, ICBC, ING Bank, Intesa Sanpaolo, JPMorgan Chase, Mizuho, Nordea, Royal Bank of Canada, SMBC, Standard Chartered, UniCredit, and Wells Fargo.
Wim Raymaekers, Global Head of the Banking Market and project lead for this initiative at SWIFT says, “The tight-knit group of leading banks will help to spearhead the testing through the pilot and beyond. Their commitment is testament to the initiative and our joint ambition to significantly improve the cross-border payments experience for corporate customers. As we progress, we aim to incorporate additional innovations and deploy new technologies to this global payments innovation initiative, and define additional service level agreements that will cater for other client groups, further reducing the costs and frictions arising from compliance, liquidity and processing efficiency considerations involved in cross-border payments.”
51 banks are now signed up to the initiative to work together to create a new service level agreement (SLA) rulebook for cross-border payments, providing an opportunity for smart collaboration between banks. In response to requests from the banks, SWIFT is offering an on-boarding process in parallel to the pilot, to ensure that all banks signed up for the initiative can prepare for live operations. The service is planned to go live for all participating banks in 2017.
In its first phase, the new service will focus on business-to-business payments. Designed to help corporates grow their international business, improve supplier relationships, and achieve greater treasury efficiencies; the initiative will enable corporates to receive an enhanced payments service directly from their banks.
“This is a smart way to address some major pain points with the current cross-border payments process,” says Magnus Carlsson, Treasury and Payments Manager at the Association for Financial Professionals (AFP). “Through the global payments innovation initiative, banks can use existing technology to quickly bring visible improvements to B2B payments for their corporate customers. From a corporate perspective this kind of development in the payments space is very encouraging as it means no significant changes need to be made to internal systems in order to potentially reap the benefits of the program.”
To stay updated on the progress, visit the page dedicated to the initiative.