SWIFT ISO 20022 Migration Begins As Global Systems Announce Go-Live

March 22, 2023
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SWIFT has announced that its migration to the ISO 20022 messaging standard for cross-border payments and reporting (CBPR+) has begun. Meanwhile, large value payment systems in the EU, Canada and Australia have also switched over.

SWIFT has announced that its migration to the ISO 20022 messaging standard for cross-border payments and reporting (CBPR+) has begun. Meanwhile, large value payment systems in the EU, Canada and Australia have also switched over.

On Monday (March 20), SWIFT completed its first full day of service using the new messaging standard, after several years preparing for the transition.

In a statement, SWIFT said its previous messaging standard, MT, will operate alongside ISO 20022 until its retirement in November 2025.

Pat Antonacci, chief customer experience officer at SWIFT, said this “coexistence period” will allow financial institutions to migrate to ISO 200022 at their own pace.

“The go-live of ISO 20022 for CBPR+ and the start of the coexistence period represents the huge collective effort of the entire SWIFT community and opens significant possibilities for the future,” he said.

“We look forward to continuing to work with the payments industry to unlock new opportunities as institutions move to fully adopt ISO 20022 and benefit from its richer, more structured data.”

SWIFT has described the new data format enabled by ISO 20022 as an “essential element” of the next generation of payments.

“It’s the foundation for financial institutions to work smarter and faster, leading to greater operational efficiency, improved data analytics and compliance, new opportunities for innovation and enhanced customer experiences,” the network said.

Harmonised switch

On the same day that the migration began, several real-time gross settlement systems (RTGS) in major jurisdictions also announced that they had converted to the new messaging standard.

In Europe, EBA Clearing said that EURO1, its RTGS-equivalent payment system, closed its first full business day using ISO 20022 without any issues.

In addition to introducing the ISO 20022 standard for EURO1, EBA Clearing has introduced extended opening hours for EURO1 and central monitoring and steering capabilities for payment and liquidity flows.

Erwin Kulk, head of service development and management at EBA CLEARING, said the migration to ISO 20022 will lead to greater efficiency in transaction processing, fraud detection and interoperability for participants.

“With this migration, we have put the powerful functionality of EURO1 and its extremely high levels of availability and robustness onto the latest technology rails,” said Kulk.

“Our users can now leverage the liquidity efficiency and cost effectiveness of the system during longer opening hours and extend to their customers the benefits of structured data based on international standards.”

Kulk added that the move completes the implementation of the EURO1 future positioning programme that EBA Clearing began in 2017.

Since 2014, EURO1 has been classified as a systemically important payment system by the European Central Bank (ECB).

T2 wholesale system goes live with ISO 20022

This week, the ECB also confirmed that its new T2 wholesale payment system is now live and is using the ISO 20022 standard.

T2 has replaced TARGET2 as the RTGS system for settling Eurosystem bank‑to‑bank payments, commercial transactions and monetary policy operations.

In a statement, the ECB said the first day of T2 operations went “smoothly” despite a delayed closure.

The central bank added that T2 settled around 400,000 transactions, which is broadly in line with the average volume of TARGET2 prior to the migration. Previously, TARGET2 processed an average daily value of €2.2trn in wholesale payments.

The software and the environment for T2 is provided by the Banca d’Italia, Banco de España, the Banque de France and the Deutsche Bundesbank.

In addition to the Eurozone, SWIFT said that RTGS systems in Australia, New Zealand and Canada have also gone live with the ISO 20022 conversion.

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