ISO 20022 is the New Language of Payments! The Standards Forum Launche...

ISO 20022 is the New Language of Payments! The Standards Forum Launched the 'ISO 20022 Adoption mApp' Featuring Information on More than 60 ISO 20022 Initiatives Globally

New adoption initiatives are encouraged to showcase their project with this mobile application

30 October 13

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How to use the 'ISO 20022 Adoption mApp'

The new ‘ISO 20022 Adoption mApp’ was developed by the Standards Forum. The Forum is organised by SWIFT (Society for Worldwide Interbank Financial Telecommunication) Standards with the support of financial institutions, leading standardisers, market practice groups, standards organisations and vendors. The Forum offers a meeting place for all interested in or impacted by standards, where everyone can share their opinions about issues and topics that will or can be debated at Standards Forum events (see ‘related links’ below).

To view the different ISO 20022 initiatives featured within the new mobile adoption application, users can either zoom into a specific region or country, or filter for a specific group of initiatives. The information on the various initiatives provided with the ‘ISO 20022 Adoption mApp’ identifies, among other things:

  • What are the drivers behind the adoption initiative?
  • What is the project status (i.e. is the project under discussion, in the planning or testing phase, or already live)?
  • What is the approach to migration (i.e. ‘big bang’ or phased roll-out)?
  • What are the ISO 20022 message sets and versions adopted?
  • Are there implementation guidelines and, if so, where can these be found?
ISO 20022 is the new language of payments

In July 2009, the Newsletter commented in an article, headlined ‘The Silent Revolution’: “ISO 20022 provides a unique tool to create the standards that respond to the needs of suppliers and customers acting in today’s financial universe. (...) As such, ISO 20022 creates the data highways enabling communication between players across all financial markets.” ISO 20022 is not only a suite of message standards but a procedure proposed by the International Organization for Standardization (ISO) to develop message standards for all domains of the financial industry. ISO 20022 is a standard to develop standards, so to speak. The most innovative characteristic of ISO 20022 is its modelling methodology which decouples the business rules from the physical message formats. The models evolve with the business, while the formats evolve with the technology to benefit from the latest innovations. This results in the highest possible degree of automation, ease of implementation, openness and cost-efficiency. The ISO 20022 approach therefore, offers a more efficient and faster way of developing and implementing message standards that serve as the basis for long term financial services solutions.

Today, the revolution is silent no more. The ‘ISO 20022 Adoption mApp’ includes more than 60 adoption initiatives globally, covering a range of business segments such as payments including cards, securities, trade finance and treasury. More initiatives will be added on a continuous basis.

Figure 1: Home screen of the 'ISO 20022 Adoption mApp' (source: 'ISO 20022 Adoption mApp').

Some payments and securities examples included in the 'ISO 20022 Adoption mApp'

The following initiatives, among others, are described by the new 'ISO 20022 Adoption mApp'

Single Euro Payments Area ()

The Credit Transfer () and Direct Debit (SDD) Schemes and adjacent implementation guidelines developed by the European Payments Council in close dialogue with the customer community are based on the ISO 20022 messages standards. With the launch of the Scheme in 2008, European banks were the first in the world to deploy the ISO 20022 message standards for mass payment transactions. The roll-out of , therefore, represents one of the initiatives that pioneered broad-scale adoption of ISO 20022. The European Union (EU) legislator recognised that technical standardisation based on the use of international standards facilitates the integration of the EU payments market. In February 2012, the EU legislator; i.e. the European Parliament and the Council of the EU representing EU Member States, adopted the ‘Regulation (EU) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro’ (see ‘related links’ below) (the Regulation). This legislative act defines 1 February 2014 as the deadline in the euro area for compliance with the core provisions of this Regulation. Effectively, this means that as of this date, existing national euro credit transfer and direct debit schemes will be replaced by and SDD. The Regulation details, among other things, the use of the ISO 20022 message standards by payment service providers and payment service users. For more information, refer to the Newsletter article, entitled: ‘Early Movers Confirm: ISO 20022 Message Standards Generate Tangible Benefits’ (see ‘related articles in previous issues’ below).

Payments in Canada (Canadian Payments Association)

The Canadian Payments Association coordinates the adoption of the ISO 20022 payments messages. This multi-year project will include the migration of three domestic payment standards, i.e. CPA005 for low value payments (AFT), MT 103 and MT 205 for high value payments (LVTS) and ANSI X12 for electronic data interchange (EDI) payments, to ISO 20022. There are three primary drivers for ISO20022 adoption: (1) The need for more remittance information to support automated reconciliation and straight through processing (STP); (2) the need to support interoperability for cross border payments and (3) cost reductions expected to result from using one standard instead of three. Approximately 16 financial institutions that are direct participants in the three legacy systems as well as indirect participants / clearers and corporate clients will be impacted by the migration to the new ISO 20022 standard. In 2012, the Canadian domestic volumes were 1.2 billion AFT payments, 7 million large value payments and 2.8 million EDI payments. A go live date has not yet been determined.

Corporate action notifications in Australia (Australian Securities Exchange)

The Australian Securities Exchange (ASX) already publishes corporate action information in proprietary format. This adoption initiative plans to introduce standardised corporate action information in ISO 20022 format, primarily for the Australian market, with potential for stakeholders in other countries. The adoption driver is to offer automated STP, with the issuer as the source of information, combined with enriched data that is aligned with the growing standard of ISO 20022. The initiative is based on the mandatory use of this automated STP by issuers; the mandate has been agreed by issuers – who see the benefits of the initiative – and will be required under ASX’s listing rules. ASX will deliver ISO 20022 format messages to customers via SWIFTNet and proprietary (ComNews) channels in near real time. Implementation will be phased, with initial delivery focused on high volume corporate actions, including dividends. The implementation of the initiative is subject to regulatory clearance. ASX is working with more than a dozen key industry stakeholder organisations and over 30 listed entities during design, development and implementation of the initiative. The planned live date is December 2013.

New ISO 20022 adoption initiatives are encouraged to showcase their project with the mApp

The app is designed to encourage new initiatives to showcase their ISO 20022 adoption project with this tool. Any party interested in having their ISO 20022 adoption initiative featured within the application is invited to email standards.forum@swift.com to receive instructions on how to feed the ‘ISO 20022 Adoption mApp’ with relevant information.

Chantal Van Es for the Standards Forum.

 

Related links:

ISO 20022 Adoption mApp for iPad for free download

ISO 20022 Website

The Standards Forum

Blog in Dialogue (The Voice of the SWIFT Community): ‘20022 - there’s a mApp for that’

EPC Website: ISO 20022 Message Standards

   

Related articles in previous issues:

Early Movers Confirm: ISO 20022 Message Standards Generate Tangible Benefits. A guide for payment service users on the impact of provisions in the Regulation regarding the use of the ISO 20022 message standards ( Newsletter, Issue 14, April 2012)

Newsletter: All Articles Published in the Section ‘Focus: ISO 20022 in the SEPA Context’



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