The compliance impacts of ISO 20022: the new standard in payments

SWIFT has been the cornerstone for financial messaging since its incorporation in the 70’s. Throughout the years, it has enabled banks to send standardised and universally accepted payments messaging using its proprietary standard. Those messaging standards have regularly undergone minor evolutions since their creation in 1977, but never so radically as in 2022.

On November 21st of 2022, both SWIFT and the Eurosystem will switch over to a new, richer, and more interoperable messaging format: ISO 20022.

Although the mechanisms for transferring value remain largely unchanged, this richer messaging standard allows for payment users and their service providers to provide a much greater level of contextual information with regards to the underlying payment. The availability of this information can help payees to better reconcile their payments, but also adds a burden to banks: they need to ensure that they have a thorough understanding of the characteristics of ISO 20022 messaging and SWIFT’s new mechanisms to safeguard and optimize their sanctions screening, anti-money laundering efforts, and fraud detection mechanisms considering these significant changes.

The objective of the training is:

• gaining a view on the ISO 20022 migration;
• to look at unlocking value by leveraging the benefits of ISO 20022. This could include creating new products that utilise the extended remittance data, enhancing the API integration with corporate ERP solutions, and using the additional rich data to build new analytical models as well as craft offers personalised to individual customers;
• acquiring a clear view on the impact on compliance and implications;
• in addition to greater interoperability, richer data, more efficient processes, and better compliance, ISO 20022 offers an opportunity for banks to re-examine business models, improve customer service, and strengthen market positioning thereby generating exponential value.