The history of EBICS
In 1995 the German banking sector mandated that all financial institutions operating within the country comply with the Banking Communication Standard (BCS) over File Transfer Access Management (FTAM). The development of this transmission protocol (BCS-FTAM), which could be used for multi-bank payments, offered German corporate banking customers an unprecedented level of efficiency: corporate clients could access all banks and send payment instructions simultaneously to several banks cost-effectively. The standard covered a range of transaction requirements, including credit transfers and direct debits.
The establishment of the standard across Germany created a neutral foundation on which advanced and highly specialised applications could be collectively developed by the sector, to further benefit bank customers and improve overall market efficiency. With the rise of internet banking - offering significant benefits to banks and their customers - the BCS-FTAM processes were further enhanced to ensure that they could be applied to internet-based transactions and activities.
The result of this evolution was the release of EBICS: an open, IP-based communication protocol between customers and banks that meets all the needs of professional users for customer-to-bank communication and vice-versa. The German banking community ensured availability of the specification to corporate clients, software engineers and banks. In 2008, compliance to the standard became mandatory for all German financial institutions.
In the same year the French banking sector - represented by the French Committee for Banking Organisation and Normalisation (CFONB) - and the German banking community, signed a cross-border cooperation agreement on the joint adoption of EBICS. Work was undertaken by both parties to ensure complete alignment and saw the migration from the French Echanges TElématiques BAnques Client (ETEBAC 3 and 5) standard to EBICS, and the release of EBICS 2.4 - the first German-French version. French banks were given a one-year timeline to implement the specification, which concluded in September 2011.
The adoption of EBICS across two countries highlighted the need for a formal organisation to be established to manage the evolution of the standard and meet future banking and business requirements, while ensuring backward compatibility with legacy systems. The EBICS SCRL company was then formed to meet this need and maintain the specification moving forward.
The specification available today offers:
- A common, open standard for all banks and customers.
- State-of-the-art technology, which aligns to the latest international and industry standards.
- The highest security of messages through electronic signatures and certificates with encryption at transport and application level offering an end-to-end trusted solution.
- Single access for all business transactions and ability to process high volumes, including direct debits, credit transfers and account statements.
- Support of third parties based on a multilevel security concept.
- Ability to authorise activity regardless of location or time.
EBICS has not been developed in isolation and much consideration has been given to the work of international standards bodies. The standard therefore offers a neutral platform that is interoperable within the global marketplace, as well as being sustainable and scalable to future market requirements.
For the German and French banking communities it assists them in containing technology risks from unknown factors. For example, it offers assurances that long-term their communication systems will advance in line with international requirements, with EBICS providing the migration support required to meet the latest specification versions and regulatory changes. It also creates market stability and inspires confidence as technology developers and banks know the requirements of the platform and the standards that they must achieve to deliver a consistent service and the highest security.
In summary, EBICS provides reliability in the planning of the banking community and protection of their investment in this area.
To enable Single Euro Payments Area () payments electronically without manual intervention - referred to as straight-through-processing (STP) - payment instruments must allow any customer to initiate a payment electronically and receive electronic confirmation once the payment is settled. EBICS supports as the standard can be used as the secure communication channel to initiate Direct Debits and Credit Transfers using the internet. See figure 1 above.
The creators of EBICS are ambitious to promote adoption of this standard on a European scale, which would allow banks to use EBICS as a single communication standard able to exchange common ISO 20022 formats and transfer messages securely.
In the next issues of the Newsletter, the competing standards developed by the Italian 'CBI - Customer to Business Interaction' Consortium and the Belgian Interbank Standards Association (ISABEL) will be highlighted. Upon conclusion of the series, the creators of these standards will be invited to share their views whether further harmonisation in this area might be on the horizon.
Narinda Viguier represents Crédit Agricole Sa Cedicam in the Plenary. Axel Weiß represents the Deutscher Sparkassen - und Giroverband e.V. in the Plenary. Narinda Viguier and Axel Weiß are members of the Board of Directors of the EBICS SCRL.
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