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10 Brilliant Tweets That Sum Up Sibos 2016

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Last week over 8300 delegates attended Sibos 2016 in Geneva, Switzerland. There were loads of forums, debates and payments related sessions covering a variety of topics across the finance industry. As i scanned twitter for Sibos 2016 some interesting themes emerged and i thought i would share these in this post. If you were at Sibos 2016 for the full 4 days, let me know if the below captures the key trends.

1. Everyone talked about how blockchain is going to transform the world

2. Blockchain was discussed everyday during Sibos 2016, and mentioned in most sessions

3. Ripple dug  into the SWIFT Global Payments Innovation Initiative (GPII)

4. Customer Experience, Disruption & Ripple (again!)

5. Talent & Culture within Traditional Financial Services was widely discussed

6. Following the recent SWIFT related hacks, Cybersecurity was a hot topic

7. Disruption, Fintech Startups and Technology Companies were discussed constantly

8. Artificial Intelligence and the use of Bots…

9. The Diversity and Financial Inclusion Opportunity

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10. The Innotribe sessions were a hotbed of activity, covering all of the cool stuff

The post 10 Brilliant Tweets That Sum Up Sibos 2016 appeared first on SEPA for Corporates.


15 Unmissable Financial Services Graphics by Innotribe

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Probably THE most fascinating stream at Sibos last week was everything happening at Innotribe! The folks from Innotribe covered all things innovation related, and the sessions were both informative and thought provoking. From the usual themes such as blockchain, disruption, fintech through to a musical jacket. It was simply brilliant. The Innotribe team around their particularly cool (picture an enclosed oval venue with an animation wall) stand had 15 graphics covering the hot topics facing financial services right now. The financial services related graphics nicely summarise the key themes across a broad spectrum of topics – check them out below:

1. Disruption at Innotribe – “Its all about Perspective”

Disruption - Innotribe

2. Emerging Technologies – “Science Fiction becomes Science Fact”

Emerging Technologies - Innotribe

3. The Future of Money- “What do Customers Want?”

Future of Money

4. Organise for Complexity at Innotribe – “Its Time to Change the System”

Complexity at Innotribe

5. Situational Awareness – “Refresh YOUR Map Every 3-4 Months”

Situational Awareness

6. Compliance at Innotribe – “We Can Do More TOGETHER”

Industry Challenges for Compliance

7. Artificial Intelligence – “Efficiency through Automation and Iteration”

Artificial Intelligence at Innotribe

8. The Future at Innotribe – “Wait and See means Wait to Die”

The Future

9. Digital Ethics – “What do YOU Value in YOUR Life?”

Digital Ethics at Innotribe

10. Start Up Challenge in Africa – “Africa is Leap-Frogging the Americas”

Start up challenge for Africa

11. Start Up Challenge in Latin America – “Move Faster, Please!”

Start up challenge for Latin America

12. FinTech Hubs: EMEA – “Innovation”

FinTech EMEA

13. FinTech Hubs: Americas – “Collaboration”

FinTech Americas

14. FinTech Hubs: Switzerland – “Will Switzerland Steal the FinTech Cheese?”

FinTech - Switzerland

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15. ThingClash at Innotribe – “Complex Systems & How They Interact with Cultures”

ThingClash at Innotribe!

 

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10 Things Ginni Rometty (IBM) Taught Me about Future Tech

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At Sibos one of the most prominent keynote speeches was that by the IBM Chairman, President and CEO Ginni Rometty. Ginni covered a lot of ground during her speech and i must admit it was pretty interesting! Following is a recap of the key themes that i took away from the discussion.

1. Financial Services are Facing Numerous Challenges

Ginni described how IBM “cares deeply for Financial Services” (awww), and how IBM (of course!) can help strengthen the sector and move it forward. This despite:

  • Unprecedented changes:
    • The need for compliance in an ever complex and growing regulatory environment
    • New technology and new technology entrants into the sector
    • Changing customer demands
  • Challenges:
    • “Shedding core businesses” – I found it fascinating that Ginni used these very words!
    • Building new ecosystems with partners
    • Cybersecurity, Big data
    • And another reference to getting eaten up or as Ginni put it “watching that someone doesn’t disintermediate you”

2. “A Moment of Opportunity, If You Choose to Seize It” – Ginni Rometty

Ginni revealed her optimism for the future of Financial Services due to 3 reasons:

  • Digital Platforms will become even stronger
  • Ultimate competitive advantage will come from cognitive technology
  • Financial Services can lead the world into a new era

3. Recognition of Recurring & Cross-Industry Requirements:

  • Data rich & analytic powerful front end apps
  • Hybrid cloud – using both the public and private cloud
  • Enhanced cyber-security

4. The Importance & Necessity of a Digital Foundation

IBM is deeply dedicated to digital and the statistics reveal why…! IBM has a revenue of over $80 billion, 38% of that comes from helping IBM customers in becoming digital.

5. “Blockchain is Part of the Digital Foundation & Will Make You More Powerful” – Ginni Rometty

Ginni clarified that she is not talking about bitcoin or a digital currency, rather the underlying technology which “allows you to have trust and efficiency in the exchange of anything”. Ginni predicts that “blockchain technology… will have a profound change in how the world works”.

Lastly Ginni talks about blockchain being an enabler for any transaction to be trusted between parties. Add traceability, authenticity, anti-money laundering, tracking, trust and the value of blockchain runs into hundreds of millions of dollars!

Ginni nicely summarises “when you have one version of the truth you can get a lot of efficiencies!”

6. “Blockchain will do for transactions, what internet did for information” – Ginni Rometty

Blockchain like the internet will need global governance and standards that must be adhered to:

  • Blockchains must be immutable – they cannot be changed
  • Only permissable transactions can be completed and recorded on the blockchain
  • IBM has been working towards ensuring blockchain is open, secure and scalable

The Linux Foundation through the Hyperledger Project is creating the standards for future blockchain applications. Ginni emphasised the importance of these standards, illustrating how the industry can then focus on building applications on top of the underlying blockchain technology and not on building what is beneath the surface, which is what everyone should share.

Current real-world blockchain examples include: Foreign exchange settlement, smart contracts, identity management (KYC), trade finance.

7. “Digital is a Foundation, but not The Destination” – Ginni Rometty

Ginni posed the question when everyone is digital, who wins? There is another shift happening, according to the IBM Chief, that will be more transformative and disruptive – Cognitive Business.

Cognitive business is:

  • What you get when you take a digital business and add digital intelligence to it
  • A business model and a technology model
  • The Destination and gives you the “ultimate competitive advantage”

8. Data is the Natural Resource of this Era

Ginni talked about how new technology is needed to deal with the data, and went on to describe how 80% of the data available to systems is largely invisible. Right now there is a lot of invisible data (videos, tweets, pictures, sound, motion, knowledge) from which no one is getting any value.

Something different different is needed to tap into this. IBM call it Cognitive. Cognitive will bring about systems that can understand, reason and learn – just like the human mind.

9. Cognitive Technology – Its all about Learning, not Artificial Intelligence but Augmenting Intelligence

Ginni describes cognitive as much more than artificial intelligence (AI). Most people associate AI with machine learning, and that is just one part of Cognitive. Looking forward Ginni believes the challenges are too great and that systems that can learn are needed to help navigate the increasing complexity of the world around us.

In a world where everything is digitised and interconnected, you simply cannot program for the increasing number of combinations – you need to build learning into your systems and processes to consume the incredible amount of data out there. A couple of noteworthy comments from Ginni:

  • “Cognitive is the first technology you’ll have that will be worth more over time, than less over time”
  • “If what you have is digital today, it will be cognitive tomorrow”
  • “Augmented intelligence.. helps you deal with the grey area”

An example of Cognitive is IBM’s very own Watson – a cognitive assistant. Watson is in 45 countries in 20 different industries across healthcare, retail, lawyers, learning, cooking and financial services.

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10. Financial Service can and will lead the World into this [Cognitive] Era

Throughout history, Ginni highlights, Financial Services have led every other major area of technology and thinks the same will be true of cognitive technology. Ginni anticipates new “platforms that will evolve around cognitive, cloud and blockchain technology because the basis of competition has already been reset, and will be reset again”.

Interestingly Ginni shares that this technology is not about replacing people, but about making better decisions. She revealed how success will be determined by information, and how every major decision made will be based on assistance from an underlying cognitive engine.

Lastly Ginni warns “You will either be disrupted or will be the disruptor”. The choice is yours!

 

The post 10 Things Ginni Rometty (IBM) Taught Me about Future Tech appeared first on SEPA for Corporates.

The SWIFT Customer Security Programme EXPLAINED!

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Anybody that uses SWIFT will have heard about the SWIFT Customer Security Programme, and in this post i will cover the main things you need to know. Right now, the SWIFT Customer Security Programme (CSP) is being validated and SWIFT are inviting the SWIFT community to give their feedback on the programme with a view to the first pilots happening next year and the enforcement of controls to begin from 1st January, 2018.

a.) First Things, First:

The first thing SWIFT speak about when it comes to the Customer Security Programme (CSP) is that as far as they know (!!) the SWIFT network itself has not been breached. But some customer environments that connect to the SWIFT network have been breached, and from those breached environments “users” have created and submitted fraudulent payments that have been submitted to the SWIFT network.

b.) So, why implement a SWIFT Customer Security Programme CSP)?

According to SWIFT, its because SWIFT have a key role to play in “reinforcing and safeguarding the security of the global banking ecosystem”. But its also because information security is a fundamental part of what SWIFT do – at the SWIFT website they constantly talk about:

  • SWIFT is a global member-owned cooperative and the world’s leading provider of secure financial messaging services
  • The global provider of secure financial messaging services
  • SWIFT carries over five billion financial messages a year. Fast, reliable and secure support for businesses the world over
  • Failure is Not An Option

With that in mind, any breach related to the SWIFT network – even if the network itself has not been breached – has a huge negative reputational impact on the SWIFT brand, and erodes trust in the overall SWIFT and financial network. Check out what the SWIFT CEO said about the recent SWIFT related hacks!

c.) Customer Security Programme: 5 Key Initiatives

  1. Improved intelligence sharing within the community
  2. SWIFT and third party products to be enhanced with additional security features
  3. Guidance detailing security requirements and controls. and an assurance framework that will help enforce standards and ensure compliance
  4. Implementing transaction pattern detection tools – such as daily reports to indicate payment activity
  5. Increase security standards by promoting closer cooperation among SWIFT and third parties (vendors and SWIFT service bureaus) that connect to the SWIFT network

Ref: Customer Security Programme – Programme description

d.) Customer Security Programme: The Framework

Here SWIFT talk about:

  1. You
    1. Secure and protect yourself – for example by implementing 2FA
  2. Your Counterparts
    1. Prevent and detect – clean up any old or unused RMAs (Relationship Management Application)
  3. Your Community
    1. Share and prepare – share details of any breach with the SWIFT Customer Security Intelligence team

e.) Customer Security Programme: 3 Objectives

  1. Secure your environment
  2. Know and limit access
  3. Detect and respond

Ref: Customer Security Programme – Security Controls

f.) Customer Security Programme: 8 Principles & 27 Controls

  1. Restrict Internet Access
  2. Segregate Critical Systems from General IT Environment
    1. Segregate SWIFT environment into a secure zone (Mandatory)
    2. Operating system privileged account control (Mandatory)
  3. Reduce Attack Surface and Vulnerabilities
    1. Internal data flow security within the secure zone and its link to user PCs (Mandatory)
    2. Security updates are implemented promptly, and hardware and software within the secure zone are within support lifecycle of the vendor (Mandatory)
    3. System Hardening within the secure zone and user PCs (Mandatory)
    4. Back office data flow security (Advisory)
    5. External transmission data protection – encrypt data leaving the secure zone (Advisory)
    6. User session integrity within the secure zone (Advisory)
    7. Vulnerability scanning within the secure zone and user PCs (Advisory)
    8. Protection of critical outsourced activities (Advisory)
    9. Transaction business controls (Advisory)
  4. Physically Secure the Environment
    1. Physical Security to sensitive equipment (Mandatory)
  5. Prevent Compromise of Credentials
    1. Enforcing a password policy (Mandatory)
    2. Implementing two factor authentication to SWIFT related applications (Mandatory)
  6. Manage Identities and Segregate Privileges
    1. User account management ensuring controls such as segregation of duties and required access only (Mandatory)
    2. Token management so that they are appropriately issued, revoked, used and stored (Mandatory)
    3. Personal vetting process before employment for staff operating locally hosted SWIFT infrastructure (Advisory)
    4. Physical and logical password storage for privileged accounts (Advisory)
  7. Detect Anomalous Activity to Systems or Transaction Records
    1. Malware protection (Mandatory)
    2. Software integrity (Mandatory)
    3. Database integrity (Mandatory)
    4. Logging and monitoring (Mandatory)
    5. Intrusion detection (Advisory)
  8. Plan for Incident Response and Information Sharing
    1. Cyber Incident Response Planning (Mandatory)
    2. Security training and awareness for all staff (annual), and specific training for SWIFT users with privileged access (Mandatory)
    3. Penetration testing (Advisory)
    4. Scenario risk assessment to improve incident response (Advisory)

Ref: Customer Security Programme - Security Controls

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g.) Customer Security Programme: Assurance Framework

  1. Self Attest
    1. Here the customer confirms that it meets the stated security requirements
  2. Self Inspect
    1. Here customers internal audit teams confirms that they meet the stated security requirements
  3. Third Party Inspection
    1. Here an external party validates that the customer meets the stated security requirements


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7 Cyber Security Points That’ll Impress Your Boss

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Last week inadvertently ended up being a cyber security focused week. It started off with the post 8 Cybersecurity Payment Threats Highlighted by the EPC and on Thursday i went to the SWIFT Institute Cyber Security 3.0 – Better Together conference in London. I found it to be a fascinating day with cyber security insights from various authorities on the topic. In this post, i thought i would share some of the themes that caught my attention.

1. Cyber Crime is a BIG Deal & the Threat will only continue to Grow

The scale of the current threat is huge, and the threat will grow – check this out:

  • All of the current cyber related stats that you see and hear about are only a subset of the actual cyber related crime activity – in short, the problem is much bigger
  • Polymorphic malware is a game changer – its malware that modifies itself so each attack looks different and therefore tracing and defending against it is difficult
  • All statistics and costs relating to cyber security and cyber crime run into the millions, billions and trillons!
  • Mobile banking is growing at a phenomenal rate
  • The number of connected devices are increasing at an astronomic rate – Gartner predicting 8.4 billion connected devices in 2017

2. Everybody talks about Collaboration, but then Forgets to!

When it comes to cyber security SWIFT, the banks, providers and even the bad guys talk about collaboration. Why?

  • Often hackers attack multiple targets using the same methods. The theory is that if the victims share all details of what happened then there is a fighting chance that the methods used can be reverse engineered and the necessary safeguards can be developed and implemented to protect any other potential targets
  • Hackers collaborate to plan, execute and prolong their attacks across borders – while often the target companies, industries and authorities in those jurisdictions do not

The problem is that Collaboration is easier said than done. It is easy and feels good to talk about collaboration at a conference, but when attendees go back to their day-to-day collaboration often gets thrown out of the window.

3. Compliance is Hard – Gottfried Leibbrandt

Gottfried often talks about practising good basic hygiene when it comes to cyber security, and he makes a good point. When experts talk about cyber security, they often describe humans as the weakest link – and yet some of the biggest risks simply require good Cyber Security Hygiene.

Next, cyber security risks are evolving:

  • Technology can assist combat fraud through solutions such as AI and machine learning that can be programmed to recognise abnormal conditions
  • But equally, newly connected digital devices present new risks – for example in Europe PSD2 will give new players access to bank accounts and enable them to make payments using APIs, and with this the payments landscape changes and new risks emerge

Of course, Gottfried and other speakers referenced the SWIFT Customer Security Programme – which i will not dwell on too much here.

4. The Amazing Geography of Cyber Crime and Cyber Security

When people talk about cyber crime and cyber security there are some countries and regional generalisations:

You must check out the Norse – Superior Attack Intelligence interactive cyber security map – it is simply amazing!

5. Regulation is Fragmented, Inconsistent and as a result Inefficient

Regulation, or lack and inconsistency thereof, is a recurring and critical cyber security theme. Often the problem is that regulation relating to cyber crime is simply unable to keep up with the fast paced world of cyber crime. Asia is often cited as a particularly vulnerable region because:

  • Anti-money laundering laws may be weaker in one country versus another
  • Many potential target institutions have huge customer bases
  • Regulation protecting individuals against cyber crime may be incomplete, weak or missing altogether!
  • Differences in cyber crime and data protection laws in one country versus another country are often different and cyber criminals exploit these gaps and loopholes

Illustrations of some recent initiatives include:

  • Europe – there is the GDPR – General Data Protection Regulation – more on this soon….!
  • US – the top US banks have come together to form the Financial Systemic Analysis & Resilience Center (FSARC) – more on this soon, too…!

6. Cyber Security is no longer the sole Responsibility of the “IT Guy”

One of the speakers shared how a few years ago cyber-security days were typically attended by the IT guy and overall attendance was “okay”, but there would be some spare seats available. Today there are cyber security conferences attended by people from all levels of an organisation and with representation from different groups (IT, business, compliance) of an organisation.

When it comes to cyber-security organisations can not afford to operate in silos, they need to understand, monitor and react across the organisation.

Professor Richard Benham has compiled a couple of interesting reports for the Institute of Directors. If you do nothing else, read these:

And if you have time, take a peek at this Harvard Business Review article: The Biggest Cybersecurity Threats Are Inside Your Company. Lastly, look out for Symantec Internet Security Threat Report for a breakdown of the various types of threats.

Thanks for stopping by – Take a look around…!!

7. You don’t need a Balaclava and Gun to Rob a Bank

The post 7 Cyber Security Points That’ll Impress Your Boss appeared first on SEPA for Corporates.

Quick Summary: SWIFT On Distributed Ledger Technologies

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Last year SWIFT released a paper – SWIFT on Distributed Ledger Technologies – highlighting the opportunities and challenges of distributed ledger technology in financial services. I know I’m a year too late (!!), but better late than never, eh? Anyway, following is a quick summary of the key points that i noted from the SWIFT paper on distributed ledger technologies (DLTs).

What is the difference between Blockchain and Distributed Ledger ?

That was the first question i asked, and came across a cool summary by Bits on Blocks. And if you’re not sure what blockchain is, check out these awesome infographics!

Distributed Ledger Technologies STRENGTHS:

SWIFT outline how DLTs enable:

1. Trust in a disseminated system

  • Removing the need for a central body
  • Enabling trust in the authenticity and validity of the data on the ledger
  • Digitally signed transactions that are maintained and validated by the network of nodes and specific software that replicates the ledger among the community

2. Efficiency in publishing information across a distributed system

  • Data is added and replicated across the network in pretty much real time, thereby ensuring that all nodes in the network are accessing and referencing the same dataset

3. Traceability of transactions

  • Data can be added to the distributed ledger, but cannot be deleted from it – making it immutable
  • This gives participants full traceability right the way through the chain

4. Simplified reconciliation

  • All participants have access, in real time (more or less), to the complete and validated ledger – guaranteeing that everyone is referencing and working off the same data set

5. System robustness

  • Distributed processing and distributed ledgers remove the need for a centralised infrastructure and service model
  • In the event of a failure in one area, distributed processing allows the connected nodes to continue processing
  • Similarly with data, a local failure can be recovered from the distributed ledger

 

Distributed Ledger Technologies “OPPORTUNITIES”:

SWIFT outline how, from a financial services adoption perspective, DLTs are still relatively immature and need further exploration. Keep in mind this was written a year ago, and a lot of those explorations / proof of concepts are happening now. Still the following areas need to be addressed:

1. Strong governance

  • The need to define roles and responsibilities and operating rules

2. Data controls

  • Outlining the need for clarity and consensus around the meaning of shared data
  • Access to data needs to be controlled and confidentiality must be respected
  • Encryption of the data is often cited as a potential solution, but managing encryption/decryption keys across multiple parties quickly becomes a headache

3. Regulatory compliance

  • In a decentralised, cross border distributed ledger who is the Regulator and who are they regulating?!?!?!
  • Given the above, how will the industry ensure compliance with KYC, sanctions lists….fill in any other regulatory requirement…?

4. Standardisation

  • Highlighting the opportunity to use ISO 20022 to enable interoperability across DLTs
  • The ability to enable Straight-Through-Processing (STP) and ensure “backward compatibility”
  • SWIFT question what would happen if a smart contract – embedded business logic on the distributed ledger that executes itself – was to go wrong?
  • Who handles the errors and exceptions…hmmm?

5. Identity structure

  • After the 2008 financial crisis, the financial services sector has implemented various controls so that you can identify all key parties in a transaction – how do you handle the question of identity in DLTs where the participants are “pseudo-anonymous”? If you can’t identify participants, how do you ensure traceability?
  • Need to ensure participants can be identified so they are accountable and thereby allowing non-repudiation of financial transactions

6. Cyber Security

  • The need to identify and prevent complex cyber attacks
  • SWIFT highlight that in a distributed ledger the protection of any non-encrypted data is down to each participant, and you cannot always guarantee the security credentials of the whole network
  • SWIFT ask some good questions:
    • Does a distributed network potentially create multiple points of attack
    • Could an attacker bombard the ledger with bad transactions and create a DoS (denial of service) attack?

7. Reliability

  • The technology must be able to support important and complex financial services
  • Availability of the service is transferred to the ledger participants, and appropriate controls ensuring their availability need to be agreed
  • Software updates need to be carefully managed and implemented by each participant – if this is not coordinated, ledger inconsistencies may be encountered (“forks”)
  • Apparently “a maximum number of fraudulent participants can be handled without compromising the integrity of a distributed system” – i will need to look into that!

8. Scalability

  • The ability to complete hundreds/thousands/millions of transactions – how do you manage that given all of the above questions ..?
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SWIFT & Distributed Ledger Technologies:

SWIFT is delving into DLTs on several fronts:

  • Research and Development (R&D) with DLTs and its community to understand use cases
  • Working on proofs of concept (PoC) in the SWIFT Innovation Lab
  • Through the Linux Foundation’s Hyperledger Project, of which SWIFT is a Board Member
  • Collaborating with industry partners to develop open source Blockchain technology
  • Partnering with its community and FinTech companies through its innovation arm, Innotribe

 

What do you think about the indicated strengths and weaknesses, share your comments below. One thing is for sure, this is a fascinating topic and i am learning all the time – More to come….!

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Sibos 2017 Toronto – Should I Stay Or Should I Go…?

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It’s that time of the year where payment folks are thinking about Sibos – the annual SWIFT conference, which this year is in Toronto. If you check out the Sibos website – the recurring message is that “Sibos is the worlds premier financial services event“. It is running from 16-19th October, all the major banks, industry influencers, technology providers and large corporate customers are there – last year there just over 8000 attendees in Geneva. Its a big deal.

In this post i thought i would look at the proposed agenda and highlight some of the more interesting sessions (for corporates) from the conference programme, and highlight that some other interesting events are happening at around the same time….

Other Financial Services Events:

  • AFP – San Diego: 15-18th October
    • A treasury and finance professional conference with around 6500 attendees
    • Looking at the program, this looks like it delves into some of the key issues/best practices/technology shifts from a corporate perspective
    • And its in California!!!
  • Swell – Toronto: 16-18th October
    • A Ripple conference in Toronto at the same time as Sibos – This is going to get messy!
    • These guys are stirring things up – its an invitation only event titled “Swell – The future is here” with speakers including Former Federal Reserve chairman Bernanke and World Wide Web inventor Berners-Lee – further details to come
  • Sibos – Toronto: 16-19th October
    • See further details below

Key Sibos Sessions for Corporates:

Sibos – Monday 16th October:

  • 0930 – 1030 - What does the future hold for banks – evolution or extinction?
    • This will be an interesting start to Sibos!
  • 1000 – 1045 - The Future of Transaction Banking – Moving into the Digital Age
    • The blurb talks a lot about blockchain – should be worth a listen
  • 1100 – 1200 – Sibos Opening Plenary
    • Let’s hear what the SWIFT folks make of it all
  • 1230 – 1330 - Lunch & Learn: FinTech – Innovative Banking
    • Will they provide lunch too… ?
  • 1400 – 1500 - Cybersecurity and Digitization: the art of securing the digital enterprise
    • As we go digital, what do we need to know about cybersecurity
  • 1530 – 1615 - The Impending Technological Revolution in FinTech and Artificial Intelligence – Are You Ready?
    • Fintech, AI – this is got to be a hot one!
  • 1645 – 1730 - Discover SWIFT gpi’s innovative features
    • Let’s get a SWIFT GPI update…

Sibos – Tuesday 17th October:

  • 0930 – 1030 - API in financial services: the key to the future?
    • I wanna get the API lowdown
  • 1230 – 1330 - The evolving payments ecosystem – a SWOT analysis from a European perspective
    • Payments, Europe that’s my isht
  • 1400 – 1450 – Global Payments Transformation
    • Sounds like this session will make sense all of the factors that are driving payment transformation, with a focus on standards – hmmm
  • 1415 – 1445 – A practical guide to SWIFT security attestation
  • 1530 – 1630 - Blockchain and payments: Lessons learnt and future prospects
    • Blockchain and payments, whats happened and where is it all going…?
  • 1645 – 1730 - Not all that Glitters is Gold: Avoiding Fear-Based Technology Decisions
    • Step back and see the bigger picture session – dunno why, but it sounds like an interesting presentation

Sibos – Wednesday 18th October: (Corporate focus)

  • 0900 – 0945 - Tapping into Academic Research in Today’s Turbulent World
    • Might check this out for a bit and then head into…
  • 0930 – 1030 - The state of global treasury – untangling the knots
    • Key issues facing corporate Treasury teams
  • 1100 – 1200 – The Future of Money
    • The focus is on Data
  • 1300 – 1345 - The new frontier of digitisation in global Corporate treasury
    • Corporate treasury innovation
  • 1400 – 1500 - Corporate perspectives – bridging the gap with banks
    • From a corporate perspective, what should the banks focus on to remain relevant
  • 1530 – 1630 - What’s next on the wish list of the corporate treasurer for global payments innovation?
    • Discussion around corporate pain-points
  • 1700 – 1730 - SWIFT ISAC: See how you can benefit from SWIFT’s cyber information sharing platform
      • If your organisation is part of ISAC, this might be worth a look
Thanks for stopping by – Take a look around…!!

Sibos – Thursday 19th October: (Corporate focus)

  • 0930 – 1030 - Does Blockchain technology alleviate security concerns or create new challenges?
    • Blockchain and security – what does it all mean?
  • 1000 – 1100 - How do global corporates expect to experience gpi from their banks? From corporate endorsement to gpi enlightenment
    • SWIFT have been talking a lot about GPI, what does it mean for corporates. Let’s find out…
  • 1200 – 1230 – APIs for Beginners
    • APIs – Getting back to basics
  • 1230 – 1330 - Payments system design in developing markets: How are developing markets driving inclusion and modernisation?
    • This sounds fascinating
  • 1300 – 1345 - SWIFT for Corporates – Cutting through the complexity of multi-banking
    • Hear from multi-banked corporates about their Treasury complexities
  • 1400 – 1500 - Operation transformation in technology for multi-banked corporates
    • Key trends and how banks and corporates can collaborate
  • 1600 – 1700 – Closing Plenary
    • Speaker to be confirmed…

Are you going to Sibos, or any of the other above listed events – if so, what are you looking forward to…?

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Sharks, Cockroaches and Dinosaurs – Sibos Day 1

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The first presentation of Sibos 2017 was “What does the future hold for banks – Evolution or Extinction?” Interesting topic to start with, eh? The panel consisted of bankers, a central banker and a techie. It was a lively presentation covering a range of themes – following are my notes:

4 Key Drivers of Change:

  • Demand -
    • The need for transparency, lowers costs, speed, products from non-banking providers, trust and closeness with technology companies
  • Supply
    • Advances in tech have opened up new ways to offer innovative products, cost of tech has significantly decreased giving rise to new entrants
  • Regulation
    • Evolution of regulation, the opening up of banking services to new entrants and technology companies
  • Demographics
    • Millenials, the unbanked, mobile device usage are all factors driving critical technology trends within specific groups

Is There a Fifth Driver of Change..?

One of the panelists (think it was the Frantz Teissedre from Société Générale) put the spotlight on Security, adding that it is a fifth driver for change which is resulting in huge investments. Frantz went on to talk about how this time change is different because all of the above are happening at the same time giving the example of instant payments

Ecosystems and Dark Data

Tom Eck from IBM spoke about ecosystems and the need for banks to be less monolithic. Tom went on to talk about co-opetition – cooperative competition – and the need for regional and product based ecosystems. Lastly Tom talked about how tech providers such as Apple, Google and Facebook have conditioned individuals to use and remain sticky with their devices.

Tom went on to describe how digital apps need to give consumers the personal touch, similar to how the bank branch manager may have known your name and where and when your next holiday was going to be. Tom suggested that with data you can better engage and connect with individuals. Right now banks have so much dark data that they need to shine a light on it. That light may be in the form of new technology such as APIs and machine learning which may reveal interesting and value added insights.

Tom suggested that rather than thinking about a bank , think of a banking ecosystem. The trick for banks is to think about the role they wish to play in that ecosystem and figure out which arena is right for them. Start with granular offering was Tom’s advice, and build on it – a bit like how Twitter did not invent the hastag. Yet Twitter created a platform that embraced the hashtag, and used it to re-order topics. The point here is that everyone is talking about ecosystems.

Financial Inclusion Requires Digital Inclusion:

Petra Hielkema from De Nederlansche Bank offered up a couple of noteworthy points:

  • First was the usual blurb from a central banker regarding the need to stay safe and robust in an increasingly fragile world
  • Next Petra talked about Accessibility – if you want to be financially included, you need to be digitally included
  • Lastly, Petra gave the analogy of different types of bicycles are built for various purpose but in order to function they need roads. Similarly in financial services there are many products – Banks have the roads or the rails on which things run

3 Responses for Banks to Consider:

Are you a:

  • Shark
    • Where you are aggressively seeking to be at the top of the food chain, eating up any competition – the predator
  • Cockroach
    • Retreating into key areas and living off the specific products – the prey
  • Dinosaurs
    • At risk of extinction

Banks are Innovators too…

Alexander Bazarov from Sberbank suggested a fourth category – a Dolphin, eating up the smaller fish, yet agile enough to dodge the sharks. The “secret” as he called it was that banks are innovators too. In the past Sibos events, Fintech companies and Banks were fighting. Nowadays they’re partnering. giving the example that banks have been using APIs for 10 years – but this time round, Fintech companies offer banks to accelerate the innovation.

Another panelist explained that the banks that lead are the sharks and everyone else is a cockroach.

4 Key Areas to Consider:

  • E-commerce
  • Internet
  • Mobile Operators
  • Social Platforms

Within each of the above sectors the key players know something that the others don’t know, but now these sectors are merging.

What’s the Difference between a Bank and a FinTech…?

Sounds like the start of a joke…!

  • Fintech companoies have the ability to take chances, make mistakes and move quickly
  • But financial services is a complex industry which is highly regulated. This aint gaming
  • So while checks are necessary, banks lose agility as a result – e.g. vendor assessments.
  • Alexander spoke about how despite the fintech challenges things are actually pretty good
  • Things are not bad enough to spark dramatic changes – so, why change? And therein lies the challenge.
  • Confusing regulations – sometimes asking a bank to increase customer protections on the one hand, and on the other making banks share data securely with third party providers
  • Lastly, many banks have legacy systems and it aint straightforward to rip them out and start over
Thanks for stopping by – Take a look around…!!

4 Key Challenges:

  • Ability to adapt operating model
  • Different regulatory jurisdictions
  • Strategy
  • Ability to attract talent

Summary:

The moderator, Thomas Olsen from Bain & Company summarised as follows:

  • Likely that banking will survive, but the question is in what mutation?
  • Some banks will adapt new and different ways of doing things
  • Banks will become diverse and involve new roles
  • Cloud, DLT are in the works, and the banks that are ahead will be best able to define future
  • Some banks will adapt and co-exist in the ecosystem, but need to define how…

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Calm the Tech Down – Sibos Day 2

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Sibos Day 2 was a hectic day, starting off with a breakfast with Sir Tim Berners Lee (the inventor of the World Wide Web), which was supposed to be followed by a session on APIs in Financial Services – but that was full. So i went to the Cap Gemini World Payments Report session (more on that next week) instead, after which i checked out a couple of payment hub vendors in the exhibition area. In the afternoon, i joined a presentation on Global Payments Transformation, SWIFT Security Attestation, Blockchain and Payments and lastly a SWIFT Institute talk by Amber Case titled Not All That Glitters is Gold: Avoiding Fear Based Technology Decisions. It’s fair to say that i was cream-crackered.

In and amongst the crazy Sibos bingo buzzwords of FinTech, Blockchain, DLTs, APIs, Open Banking and PSD2 – it was a refreshing, calming, relatively jargon free reality check and warning by Amber Case that you must not get carried away with technology. Check out Principles of Calm Technology and The World is not a Desktop for full details, but following is a quick snapshot of the key messages from today’s session

What the Tech Are You Talking About?

Amber made the case that many technology terms are categories which need to be better understood, and encapsulate multiple types of technology. For example, AI is a suitcase term, with lots of luggage in it!

We Don’t Need Smart Devices, We Need Smart Humans – Mark Weiser

So here, Amber talked about new technology arguing that just because it’s new, it doesn’t mean its good and must be adopted everywhere. Quoting the Cisco 50 billion devices will be online by 2020 statistic Amber talked about some of the needless technology around a fridge – e.g. fingerprint authentication to open your fridge door - and went further to say that sometimes you need the least amount of tech in devices. Ideally you would have technology that works well in sub-optimal conditions so that it is tried and tested.

This is an era of interruptive technology proposed Amber, and rather than giving humans more time back technology has become all consuming,With too many devices, humans lose attention and technology becomes the primary focus and as a result we need a calm technology

Pay Attention – Calm Technology Considerations:

  • Technology should not require all of our attention, just some of it
  • Technology should empower the periphery (your periphery attention)
    • In a car, our primary focus is on the road, second focus on gear stick, and third focus is on the pedals
    • With a phone, it (the phone) becomes our primary attention and that could be dangerous
  • Technology should inform and encalm
    • For example by making the invisible visible by creating awareness through different senses (using a status indicator) – e.g. making a cold pipe turn blue and hot pipe turn red
  • Tech should amplify the best of tech and the best of humanity
    • Humans shouldn’t act like machines and machines shouldn’t act like humans
    • This would free up human time so we can concentrate on things we know best
  • Technology can communicate, but it doesn’t need to speak
    • For example, simple light indicators do exactly what they need to
  • Technology should consider social norms
    • Humans deal with technology in different ways:
      • Whatever is normal becomes invisible – e.g a camera on your phone
      • Whatever is restorative becomes accepted – e.g a prosthetic leg
      • Whatever is enhanced makes people nervous – e.g. google glasses contained too many features and as result people were not engaged with the product. In fact, people were scared by the product
  • Right amount of technology is the minimum amount needed to solve the problem
    • Good examples incvlude street lights, toilet occupied sign – they are so common now, they have become invisible – or ubiquitous
  • Technology should work even when it fails
    • The example Amber gave was the escalator, when it fails it becomes some stairs (a bit of a headache, but still workable)
    • Process as much as possible on the device itself
  • Good technology design allows people to accomplish their goals in the least amount of moves
  • A persons primary task should not be computing, but being human
    • Here Amber quoted Mark Weiser – The scarce resource of the 21st Century won’t be technology, it will be our attention.

Keep Calm and Carry On :)

Thanks for stopping by – Take a look around…!!

 

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The Future, Money Or Data? – Sibos Day 3

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Okay, i know this is late – but better late than never, eh? On day 3, one of the best panel discussions was around the Future of Money. Here are my notes from the big issue debate which asked which is more important data or money?

Data, the Digital Oil

In the introduction Carmel Crimmins, from Reuters, spoke about how data is the digital oil that is powering new services and driving strategic change. Carmel continued to explain how banks are sitting on a huge treasure trove of data, but they cannot be complacent in this new world. For there are mega-technology companies such as Google, Facebook and Amazon who are masters at refining, extracting and selling users data, and these companies plus others will soon have the ability to access this bank data. The problem for banks is that while they are sitting on huge amounts of data, the banks ability to retrieve the data is hampered by legacy systems, silo businesses and a multitude of businesses within a single organisation – each vying for the data and perhaps missing the bigger overall picture.

Data or Money, which is more Important?

The view from the bank was put forward by Ather Williams of Bank of America Merill Lynch:

  • Ather explained that it wasn’t a either or question, rather the question should be to understand where is the money?
  • While data can be used to provide insights and allow companies to grow their business by better serving their customers, money is at the heart of everything that happens – in short, money is foundational
  • Data should be used to enable:
    • Simplification – for example, payments are only useful when you know what you’re being paid for
    • Risk Management – how to better understand and serve the customer
    • Proactive Insights – to manage cybersecurity and fraud
  • On cheques Ather gave the crowd a laugh by suggesting that “people that write cheques will probably die before cheques do”
  • On giving access to non-banks to customer data held by banks, Ather spoke about the challenges around:
    • Giving permission to the data
    • Understanding who has access to which data in the new world
    • How to anonymise data to protect the customer

The view of the challenger bank was offered by Megan Caywood from Starling Bank:

  • Megan was an interesting lady, and explained that Starling Bank was a tech-startup with a banking license that is focusing on retail current accounts on a mobile app
  • Clearly for Megan and Starling Bank data is more important…
  • Megan explained how historically banks sat on the the data treasure trove and believed that the data belonged to them, but now with the PSD2 regulation banks no longer own the data
  • Now the data viewpoint is changing, customers own their data not the banks – and more importantly banks no longer (by default) have the upper hand and ability to upsell within the banking organisation – and pointed to the the unbundling of the bank
  • With the disintermediation of banking, customers will have greater choice and greater access and this is a huge threat to traditional banks Megan warned
  • And for challenger banks such as Starling, this is a huge opportunity because they have built the bank from scratch using new scalable technology that enables them to build a marketplace, a platform, that other fintech companies can easily plug into

Lastly, Richard Koh from M-DAQ Group represented the Fintech companies:

  • I liked this guy – he had some great analogies! These guys give you better foreign exchange visibility, certainty (and savings) into cross border transactions
  • Richard talked about how the Amazon one-click patent had recently expired and allowed other companies to offer that one-click experience to their companies, and how that was important – he suggested that for Amazon it was worth up to $2 billion in revenue
  • Again Richard was on the side of data, explaining how data offers companies like AliPay to better understand their customers by collecting data around all aspects of the customers online life – and from this companies are able to determine the customers “willingness to pay” – and this is important to know because while some customers may be able to pay, they may not be willing
  • Richard talked about:
    • Fintech 1.0 – where technology was being used to enable better and faster technology based solutions
    • Fintech 2.0 – where data will be used to give unprecedented insights into trends and habits
  • Lastly, Richard described how in China, the largest bank is not a bank and that the trend toward eWallets grew in the country due to the amount of counterfeit notes that were in circulation and even being issued through the ATMs – for which there was no recourse

Interesting Comments:

Technology enhances the Customer Experience

  • Megan talked about Starling bank being a mobile first, and having a mobile only strategy, company
  • She also described how their customer base spans the age spectrum and does not consist of digital natives only
  • Banks up to 2008 were pretty innovative but after the financial crisis their attention turned to regulatory compliance and the need to be cautious, but that same year the iPhone was launched, and soon after came WhatsApp, Uber and Airbnb.
    • From a product experience perspective, a gap emerged therein between what customers wanted and what the banks delivered
    • Customer want to do anything and anywhere over their mobile phones
    • Megan gave the example of how it can take up to 6 weeks to open a bank account through a bricks and mortar branch, through the Starling Bank app, it takes less than 2 minutes!
  • Megan described how some banks believe they are digital because they have a mobile app, that ain’t enough she warned – it is about giving the customer a complete and end to end digital experience
  • Megan wrapped up by explaining that collaboration between banks and fintechs is key, and the successful will be those that keep disrupting their own products and services

The Full Circle

  • Ather countered the above argument, explaining how Amazon launched about 20 years ago was entirely an online business but now they are opening up retail stores
  • While apps are undoubtedly good, in the end people want to touch and feel things, and speak to real people
  • He advocated that bank branches are places of sales and advisory and there is a place for that service
  • Ather concluded that the dialogue between banks and fintech has evolved since 2003, now the discussion is one of collaboration and the different viewpoints needed to come together to drive the industry forward
Thanks for stopping by – Take a look around…!!

A Different Way of Looking at the Same Thing

  • Richard when asked about the need for money explained that even in a digital form, it is still of value – it is still money – and required a different way of looking at the same thing
  • On data, Richard explained that there is sometimes too much data and that it needs to be organised appropriately
    • Richard gave the example of increasing ice cream sales at a beach in the summer and an increased number of drownings too. But you cannot link increasing ice cream sales with drowning – so you need to be careful of algorithms
  • Richard explained that there isnt necessarily a fight between incumbent banks and Fintech companies, rather:
    • Fintech’s exist in a space where traditional financial institutions have not really operated in the past and were unprofitable, they had bigger fish to fry
    • In fact, fintech companies are helping incumbent banks to re-imagine and reinvent financial services by innovating, experimenting and improving the customer experience
  • Richard gave a couple of good examples around how we should rethink the current landscape:
    • During the gold rush, the people that made shovels or dug for gold weren’t the successful folks, it was the ones that made jeans
    • The urban legend is that Henry Ford was trying to build faster horses, in fact the problem was not building faster horses it was how to clean up the mess made by horses. In this context, the solution was not a faster horse it was a mechanical horse – i.e the automobile
  • Richard’s concluding remark was that data and money are two ends of the same spectrum, and that data would help to re-imagine financial services

In the end the audience concluded that data (57%) was more important money (43%).

The post The Future, Money Or Data? – Sibos Day 3 appeared first on SEPA for Corporates.

8 Things I Learnt from Satya Nadella at Sibos, Day 4

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For those that don’t know, Satya Nadella is the Chief Executive Officer of Microsoft, and succeeded Steve Ballmer in 2014. Satya closed Sibos in Toronto last week and following are the 8 key themes that i picked up on from his chat with SWIFT CEO Gottfried Leibbrandt.

1. The Need for Innovation has Never been Greater

  • Satya talked about 2 key themes – innovation and managing risk – and about the transformative power of digital technologies and secular forces
  • Software was described as one of the most malleable resources that humankind has ever found, and one that requires even greater compute into the future
  • The example that Satya gave was that the Xbox 1x that is due to come out soon has 7 billion transistors, while the first super computers had “only” 13.000 – yet Satya explained how Moore’s Law is flattening
  • Satya expressed excitement about:
    • Mixed reality – that is where we will have multi-sense and multi-device experiences in the future
    • Experiences will be infused with AI – but in warned in order to achieve this, we must get our data in order, for you cannot have AI without good data
    • The need to think about new ways to compute (a word Satya used a lot!) – quantum computing being the most extreme, but cloud technology in the short term

2. You’re either busy being born or busy dying – Bob Dylan

As expected, Satya’s comments here were with reference to the banking industry and here Satya explained the need for a healthy banking industry to help drive the economy and wider society. Satya warned that the ability to create economic opportunity around the world relied on the ability of the banking industry to continuously reinvent itself. He quoted Bob Dylan – “either you’re busy being born or busy dying

Satya reiterated this message:

  • Encouraging the industry to question – why do you exist, and the need to constantly challenge the status quo
  • Instilling a learning culture, as opposed to a know it all culture
  • The recurring need to innovate and renew a sense of purpose
  • Above all, continuing to restore the need to stay relevant

3. Retaining A Sense of Purpose

Interestingly, Gottfried questioned Satya about Microsoft’s purpose. Drawing on SWIFT’s own purpose starting out in 1973 to kill the telex, and Microsoft’s initial mission in 1975 of putting a personal computer in every home and on every desk – Gottfried asked, what now?

Satya’s response was compelling. He spoke about Microsoft’s first product the basic interpreter and explained that the mission then and now was to:

  • “Create technology so others can create more technology”
  • Be a trusted platform provider
  • Think about tools that can solve problems that have not been solved
  • Build a universal quantum computer
  • “Have a sense of purpose and mission that is enduring, and that truly captures the core of your existence and then renew it with audacious goals”

4. Quantum Computing is on the Horizon

I must admit i don’t know much about quantum computing, but it was a recurring topic for Satya. Satya is clearly excited by the prospects of quantum computing and described his excitement of how it brings together maths, physics and computer science in a unique way.

If like me you know little about Quantum computing, it’s clearly something to brush up on!

5. Blockchain Optimism and Massive Implications

Satya spoke about blockchain briefly, but with fascination about the prospects. He mentioned the:

  • Distributed database technology with a trust harness that allowed users to collaborate in innovative ways
  • Opportunities brought about by cloud technology and platforms
  • Massive implications and optimism about what the technology could mean
  • Suggested that blockchain technology was in “your” hands and that it has to be converted into something that can be useful

6. Security is THE hot topic of our Time

The frontier as Satya described it, is technology and security. He warned that security is not just about protection but about operational security – i.e. it is an intelligence game and suggested that the core was to continually build updates rather than standalone solutions.

The responsibility is to ensure that:

  • Software is secure
    • Satya advised be in no doubt this is a cat and mouse game
  • End points are protected and updated
    • There is a need constantly update your network with patches and if just 1 entry point is vulnerable, that makes you vulnerable
    • Moreover, updates alone are not sufficient you need to segment your network and ensure that it can be isolated in the event of a hack
  • Information is shared with one another
      • There is a need for collective responsibility – giving the example of you can’t get fit by watching others go to the gym!

Lastly, Satya reiterated the need for Microsoft to continually build updates so that others are secure

7. Building a Learning Organisation – Learn It versus Know-It-All Culture

I found this piece really interesting. Gottfried and Satya talked about how companies when they start out have a clear sense of purpose, need to build certain capabilities  and the company culture is built out of the purpose and capabilities. But once that purpose and capability has been fulfilled, what next? Here Satya talked about:

  • Building a new culture
  • Referred to the book Mindset by Carol Dweck which helped him recognise the importance of building a learning organisation where the company should be encouraged to keep learning
  • The goal was to become a learn it organisation rather than a know it all organisation
  • The challenge though was how to truly become a learning organisation – just because you say it, it doesn’t mean it happens
Thanks for stopping by – Take a look around…!!

satya-nadella

8. “You Can’t be Cool by Association” – Satya Nadella

Satya closed up by sharing that he has a unique left and right view of technology and it’s impact across multiple industries. He offered the following advice:

  • What differentiate successful organisations is how they deal with and manage change, and following on from that how they implement change
  • Progressive organisations must build digital sensibility
  • You can’t be cool by association, just because banks invest so much in technology (sometimes more than tech companies themselves) it does not mean they understand technology and that is the trick – to truly understand technology
  • Do not reinvent the wheel advised Satya, do work in your domain that is increasingly digital
  • The journey is not one for a single quarter, this is a generational shift where what is core to banking will involve digital capabilities
  • Walk away from the conference knowing that you are relevant

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9 Cool Fintech, Security and Tech Graphics from Sibos 2017

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Okay, last post reflecting information from Sibos 2017. Here i share some of the graphics that i spotted over the 4 day Toronto conference which capture key cybersecurity, fintech and tech themes. Take a close look at the graphics, there are some pretty interesting messages and let me know what you think in the comments below:

1. Technology – Keep Calm and Make The Right Decisions

Key Takeaway: Avoid fear based technology decisions!

01-calm-technology

2. The Rise of Fintech & Innovative Banking

Key Takeaway: Traditional banking is being disrupted because its expensive, trust in large financial institutions has dwindled and tech companies are attracting the best talent

02-fintech-innovative-banking

3. Moving Banking into the Digital Age

Key Takeaway: There is a recognised need to digitally upgrade cross border payments processing

03-future-transaction-banking-digital-age

4. The Future of Transaction Banking

Key Takeaway: Transaction banking requires interoperability

04-future-of-transaction-banking-qa

5. The Cyber Security Ecosystem

Key Takeaway: Cyber security ain’t an IT issue, there are many different impacts

05-cyber-security-ecosystem

6. Evolution of Cyber Threats

Key Takeaway: The cyber security threat is constantly evolving, and financial institutions are primary targets

06-evolution-cyber-threats

7. Cyber – The New Normal

Key Takeaway: From a SWIFT perspective there is pre-Bangladesh and a post-Bangladesh

07-fraud-cyber-the-new-norm

8. The Future of Financial Intelligence Sharing

Key Takeaway: To succeed in the fight against cyber crime, the industry needs to cooperate with one another

08-future-of-intelligence-sharing

Thanks for stopping by – Take a look around…!!

9. The Quantum Threat in Financial Services

Key Takeaway: High level decision making must start now!

09-quantum-threat-financial-services

The post 9 Cool Fintech, Security and Tech Graphics from Sibos 2017 appeared first on SEPA for Corporates.

The Difference Between a camt.052, camt.053 and camt.054

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I have had a couple of recurring questions about bank statements recently, and rather than responding to the individuals directly i thought it would be useful to address the question via a post. So, if bank statements are your thing check out my posts about the BAI2 and MT940 file formats.

What is CAMT?

  • CAMT is an ISO 20022 Payment Message definition that stands for Cash Management and specifically covers Bank to Customer Cash Management reporting
  • Keep in mind that ISO 20022:
    • Defines the ISO standards for electronic data exchanges between financial institutions,
    • ISO nicely put it as the “Universal financial industry message scheme”

What is the difference between camt.052, camt.053 and camt.054

  • camt.052 – Bank to Customer Account Report 
    • This is your intraday information
    • Provides the customer with a near real time view of their account(s)
    • The camt.052 replaces the MT942
  • camt.053 – Bank to Customer Statement
    • This is your previous / prior day bank statement
    • Provides the customer with detailed and structured information on all entries booked to their account for the previous day
    • The camt.053 replaces the MT940
  • camt.054 – Bank to Customer Debit / Credit Notification
    • Provides the customer with specific account debit and account credit information
    • The camt.054 replaces the MT900 (Confirmation of Debit) and MT910 (Confirmation of Credit) messages

What are the Benefits of CAMT Reporting?

  • Using ISO 20022 (XML) and CAMT reporting allows banks and customers to use a standard way of reporting account information globally
  • CAMT reporting enables consistency, moving towards a standard where banks populate the information in a specific and defined  manner
    • Banks can no longer construct an account statement in its own unique way, there are specific tags to report specific information – in BAI2 and MT940 some rows such as Transaction Detail (BAI2, record 16) or Statement Line (MT940, tag 61) can be populated in various and generic ways – each bank having their own flavour
  • CAMT messages allow more information to be shared, the CAMT formats will not truncate remittance information for example – this enhanced richer reference and description information about the account credit or account debit facilitates and should improve the bank statement reconciliation process
  • CAMT Messages enable flexibility around how you report, allowing customers to receive reporting information in various standardised ways – for example, many APIs are using ISO 20022 standards to exchange information over legacy file formats
  • CAMT is a global format leveraging the ISO 20022 XML standards allowing better interoperability with your banks and your internal systems
    • The idea being you can move away from multiple bank statement formats – BAI2 mainly in the US, MT940  in most other countries, but in some cases you may also be using local or bank proprietary formats – to just the CAMT reporting standard
    • But, of course, you must work with your banks and the appropriate teams that support your internal systems (particularly legacy systems) to ensure compatibility
  • The end goal is to enable corporates improve the end to end business process from payments to reconciliation
Thanks for stopping by – Take a look around…!!

Hope that helps – please let me know if you would like any other information about the various CAMT reporting messages.

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A Practical Guide to the Bank Statement CAMT.053 Format

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Following on from the posts about the BAI2 and MT940 bank statement formats, I have had a few requests to provide an overview of the camt.053 format. I will not go into the details of each tag within the CAMT.053 format – for that you should ask your bank(s) to provide you with a detailed CAMT.053 specification and an example CAMT.053 file so you (and your source systems) know exactly what to expect. What i will share in this CAMT.053 format overview is the information you need in order to read and understand the example CAMT.053 file.

So, here goes…

What is a CAMT.053?

  • CAMT.053 is a Bank to Customer Statement, essentially providing you with a prior or previous day statement of your account
  • CAMT.053 will indicate all entries booked to the account for the previous business day
  • CAMT.053 is an updated and standardised version of the MT940 and prior-day BAI2 bank statement formats

To know the difference between a camt.052, camt.053 and camt.054, read this!

CAMT.053 – File Structure:

Each CAMT.053 file consists of:

  • CAMT.053
    • Group Header
      • Statement – There will be at least 1 Statement (for each account)
        • Balance – Contains the Opening and Closing Balance
        • Entry – There may be multiple entries
          • Entry details – There may be multiple entry details
            • Batch 
            • Transaction details
      • End of Statement

CAMT.053 – Supported XML Characters:

a b c d e f g h i j k l m n o p q r s t u v w x y z
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
0 1 2 3 4 5 6 7 8 9
/ – ? : ( ) . , ‘ +
Space

CAMT.053 Format Description:

The following will provide an overview of what information to expect to see within each section of the CAMT.053 file. Keep in mind that most of the below tags will expand to reveal additional / in-depth information about the tag. Please do consult your bank and request their specification and a sample file to understand exactly how your bank is generating the camt.053 bank statement format.

CAMT.053 Specification – Group Header:

Group Header:

  • <MsgId> – Message Identification
  • <CreDtTm> – Creation Date / Time Stamp
  • <MsgRcpt> – Message Recipient
  • <MsgPgntn> – Message Pagination

CAMT.053 Specification – Statement:

Statement:

  • <Id> – Unique identifier
  • <ElctrncSeqNb> – Electronic Sequence Number
  • <CreDtTm> – Creation Date / Time Stamp of the Statement record
  • <FrToDt> – From Date
  • <Acct> – Account
  • <Bal> – Balance – See details below
  • <Ntry> – Entry

CAMT.053 Specification – Balance:

Balance:

  • <Tp> – Type
    • Codes include:
      • OPBD – Opening balance
      • CLBD – Closing balance
      • CLAV – Closing available balance
      • OPAV – Opening available balance
      • PRCD – Last closing balance
      • ITBD – Interim booked
  • <Amt> – Balance amount with currency
  • <CdtDbtInd> – Credit / Debit Indicator
    • Valid values:
      • DBIT – Debit Balance
      • CRDT – Credit Balance
  • <Dt> – Date

CAMT.053 Specification – Entry:

Entry:

  • <Amt> – Transaction amount and currency
  • <CdtDbtInd> – Debit / Credit Indicator
    • Valid values:
      • DBIT – Debit Balance
      • CRDT – Credit Balance
  • <Sts> – Status
  • <BookgDt> Booking date – when entry is posted to the account
  • <Dt> – Transaction date
  • <ValDt> – Value date
  • <Dt> – Value date of the transaction
  • <AcctSvcrRef> – Account servicer reference
  • <BkTxCd> – Bank transaction code
  • <AddtlInfInd> – Additional information indicator
  • <MsgNmId> – Message name identification
  • <NtryDtls> – Entry details – See details below….
  • <AddtlNtryInf> – Additional Entry Information

 

CAMT.053 Specification – Entry Details:

Entry Details:

  • <Btch> – Batch – See details below…
  • <TxDtls>- Transaction Details – See details below…

CAMT.053 Specification – Batch:

Batch:

  • <MsgId> – Message Id
  • <PmtInfId> – Payment information identification
  • <NbOfTxs> Number of transactions in batch
  • <TtlAmt> – Total amount of batched transactions
  • <CdtDbtInd> – Credit / Debit Indicator
    • Valid values:
      • DBIT – Debit Balance
      • CRDT – Credit Balance

CAMT.053 Specification – Transaction Details:

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Transaction Details:

  • <Refs> – References
  • <MsgId> – Message Id from the incoming SEPA transaction (in PAIN.001)
    • <PmtInfId> – Payment Information Id from the incoming SEPA transaction (in PAIN.001)
    • <EndToEndId> – End to End Identification from the incoming SEPA payment
    • <TxId> – Transaction Identification
    • <MndtId> – Mandate Identification – for SEPA Direct Debit transactions
  • <AmtDtls> – Amount details
  • <InstdAmt> – Instructed amount
  • <BkTxCd> – Bank transaction code
  • <Chrgs> – Charges
  • <Intrst> – Interest
  • <RltdPties> – Related parties – i.e. name/address of initiating party and ordering party and their bank details
  • <RltdAgts> – Related agents – i.e. debtor agent and creditor agent bank details
  • <Purp> – Purpose – Reason for the transaction
  • <RmtInf> – Remittance Information
    • <Ustrd> – Unstructured
    • <Strd> – Structured
  • <RltdDts> – Related dates
  • <RtrInf> – Return Information
  • <AddtlTxInf> – Additional Transaction Information

Hope that helps. Please let me know if you have any pressing questions…!

The post A Practical Guide to the Bank Statement CAMT.053 Format appeared first on SEPA for Corporates.

Payment Fees – The Difference Between BEN, OUR and SHA

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I have received a couple of recurring questions about payment fees, specifically the difference between BEN, OUR and SHA. So, lets get straight to it…

Payment Fees / Transaction Charges

The sending bank and receiving bank in a payment transaction may charge a fee for processing the payment. Within each payment specific codes are used by the sending bank to understand how any payment charges or payment fees should be handled.

If you’re sending money abroad, you will be asked how you want any transaction fees to be managed. Here is what you need to know.

The Difference between BEN, OUR, SHA

  • BEN (BENeficiary) –
    • The Payee (recipient of the payment) will incur all of the payment transaction fees
      • Typically, the recipient will receive the payment minus the transfer charges
    • The Payer (sender of the payment) will not pay any payment fees
  • OUR –
    • The Payer (sender of the payment) will bear all of the payment transaction fees
      • Normally you will be billed separately for the payment transfer
    • The Payee (recipient of the payment) will not pay any payment fees,
      • The beneficiary will receive the full amount of the payment
  • SHA (SHAred) –
    • The Payer (sender of the payment) will pay all fees charged by the sending bank
      • You will be billed separately for the payment transfer
    • The Payee (recipient of the payment) will pay all fees charged by the receiving bank
      • The recipient will receive the payment minus any correspondent /intermediary fees

Where to Indicate Payment Fees

If you’re submitting the payment via an App, internet banking or a paper form you’ll select one of the above options from a drop down list. But if you’re generating the payment within your ERP system, here’s where you specify this information:

MT101 – Field 71A: Detail of Charges

In the MT101, specify the appropriate value in field 71 (detail of charges) as follows:

  • :71A:BEN
  • :71A:OUR
  • :71A:SHA
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PAIN.001 – Charge Bearer: <ChrgBr>

In the PAIN.001, specify the appropriate below value in the Charge Bearer <ChrgBr> tag

  • CRED –
    • The Payee (recipient of the payment) will incur all of the payment transaction fees
  • DEBT –
    • The Payer (sender of the payment) will bear all of the payment transaction fees
  • SHAR  –
    • The Payer (sender of the payment) will pay all fees charged by the sending bank
    • The Payee (recipient of the payment) will pay all fees charged by the receiving bank
  • SLEV –

 

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5 Points From the SWIFT London Business Forum 2018 Nobody is Talking About

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Yesterday i was one of about 1100 registered delegates that attended the SWIFT London Business Forum 2018 at Tobacco Dock. The theme of the forum was “Seizing the Opportunity”, and there were the usual punchy cross-industry topics (fintech, regulation, machine learning, AI, cybersecurity… you get the idea) being discussed by some pretty high profile and interesting folks.

To get a good detailed insight into the SWIFT London Business Forum i recommend reading the Finextra live blog. In this post, i thought i would share some of the less discussed, but insightful, topics and comments that i picked up through the day.

1. Instagram must remain Relevant to key users such as Swift Taylor, SWIFT must do the same!

In his opening remarks Javier Pérez-Tasso (Chief Executive, Americas & UK Region, SWIFT) talked about the Fourth Industrial Revolution, and explained how technology companies like the GAFA’s (Google, Amazon, Facebook and Apple) of this world are operating a 2 sided model connecting users (1) via their platforms (2). This model requires the technology companies to remain relevant, if they don’t their users and customers will go elsewhere.

As the heading suggests, Javier gave the example of Swift Taylor using Instagram as a way to reach out to her fan base and the need for the application to remain relevant to all users. If they fail to remain relevant, Swift Taylor and her followers will simply go elsewhere. Similarly, SWIFT and banks must remain relevant to their customers and ensure that they offer value to retain their customers – particularly in light of the multiple emerging players.

With this in mind, Seizing the Opportunity seems like an appropriate call for action!

Remain relevant.

2. Jeff Bezos said “Customers are Divinely Discontent”… So too are Regulators!

During the Opening Plenary titled “Transformation through Collaboration” Andrew Pearce from HSBC explained the nature of the fast paced financial services environment. Andrew described how a single participant in the ecosystem is unable to effectively do everything, and as a result collaboration with the appropriate companies is required.

Anyway, in this climate Andrew referenced Jeff Bezos’ “customers… are divinely discontent” comment from the Amazon CEOs recent letter to shareholders. I thought it was a pretty cool quote emphasising how customer expectations are never static, customers expect more, technology is enabling more and organisations that fail to adapt will no longer remain relevant to their customers (see above).

The theme is very relevant to financial services, Andrew went further and thought Regulators were also “divinely discontent”…!!

Don’t settle.

3. Bank of England Exec – Understand Fintech and get closer to Tech

In the above mentioned Opening Plenary, during the closing comments Andrew Hauser (Bank of England Executive Director for Banking, Payments and Financial Resilience) unexpectedly rocked the boat. When asked to give his closing comments, Andrew suggested that SWIFT needs to delve further into the fintech space and believed better to know the enemy (if you consider it an enemy) than not!

That was an incredible comment, followed by further thoughts that the panel was not very fintech, and that SWIFT ought to get its head around fintech and get closer to tech.

Awkward.

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4. How you Perceive the World determines whether Technology is Disruptive or not

Aleks Krotoski was the host for the day, Aleks is a tech presenter/social psychologist and shared some really thoughtful observations. Following are a couple of insights that got me thinking about the way in which we each see the world around us differently:

  • Technology has become so mundane that some really advanced tech (think about your phone, TV, watch) is not even seen or sensed – it is just there and we take it for granted. Yet, to reach this advanced state that technology has grown, evolved and reached a state where we no longer see it and for generations such as millennial’s it is the norm. That is all they have ever known
  • Aleks illustrated how adding the word “disruptive” to technology means that you automatically isolate yourself from the technology and from the underlying problem that the “disruptive technology” is solving. She went on to show how the developers of the technology don’t see it as “disruptive technology”, they view the tech as a solution to a known problem and are not even thinking about any type of disruption
  • Diversity is key, following an inspirational introduction by Amali de Alwis (CEO, Code First: Girls) Aleks further highlighted how a diverse group of coders enabled a more appealing platform/solution for customers

Thought Provoking.

5. Ego’s will determine the Success / Failure of Financial Services

Ego was a term that came up at the end of the “Building Blocks to Open Banking” session. Russell Saunders (MD for Payments at Lloyds) in his closing remarks talked about how in order to be successful open banking required key decision makers to leave their egos behind and imagine the outcomes and opportunities that various innovations can potentially bring about.

Russell highlighted boardroom culture as one of the key barriers to the future success of open banking. And it is with this outlook in mind that the comment about ego really hits home.

The ego theme was picked up by Aleks too in her closing remarks, outlining how ego can cloud minds at different scales of the financial services spectrum. Ego can lead reinforce incumbents beliefs that they are too big to fail and within startups set false expectations that they are going to “disrupt” everything.

I suppose the true leaders have the humility to recognise their customers needs, and ensure that their organisations adapt accordingly.

Stay humble.

Source: SWIFT

The post 5 Points From the SWIFT London Business Forum 2018 Nobody is Talking About appeared first on SEPA for Corporates.

Read This If You’re Thinking About Joining SWIFT

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While there are many ways for corporates to connect with their banks, if you want a single, secure, reliable and global multi-bank solution – then SWIFT is your answer. Before you get too excited you should understand their are some upfront considerations that you must take note of before joining SWIFT. This post will cover some of the admin and hoops that you must jump through in order to join SWIFT.

1. Who can join SWIFT?

  • Banks
  • Payment, securities and treasury market infrastructures
  • Broker/dealers
  • Custodians
  • Investment managers
  • Fund participants
  • Corporates
  • Exchanges
  • Matching utilities
  • Clearing houses

Read here for further information about who can join SWIFT.

2. SWIFT User Categories:

Joining SWIFT requires your organisation to register itself as an authorised SWIFT user under one of the following categories. Read here to understand the different eligibility criteria for each user category – but i have indicated a quick (but incomplete) overview below of the categories that are most relevant to corporates:

  • Supervised Financial Institution (SUPE)
    • An entity that is involved in payment, securities, banking, financial, insurance, or investment services and either licensed, authorised, registered or supervised by a Financial Market Regulator
  • Non-Supervised Financial Entity active in the Financial Industry (NOSU)
    • An entity that is involved in payment, securities, banking, financial, insurance, or investment services
    • Is not supervised by a Financial Market Regulator
    • Is an entity that is:
      • Incorporated
      • In good financial standing
      • Subject to regular audits
    • An entity:
      • Majority owned by a Supervised Financial Institution.. or…
      • Recommended by 3 independent Supervised Financial Institutions
  • Closed User Group and Corporate entities
    • For each Closed User Group an administrator is responsible for the rules, services and admission criteria to each of the following user categories:
      • Corporate (SCORE – Standardised Corporate Environment)
        • Corporate must be:
          • Listed on the stock exchange of a Financial Action Task Force (FATF) country
          • Majority owned by an entity that is listed on the stock exchange of a Financial Action Task Force (FATF) country and be
            • Incorporated
            • In good financial standing
            • Subject to regular audits
          • Recommended by a SCORE financial institution located in a FATF country
      • Financial Market Regulator (REGU)
      • Payment System Participant (PSPA)
      • Securities Market Data Provider (SMDP)
      • Securities Market Infrastructure System Participant (SSPA)
      • Service Participant within Member-Administered Closed User Group (MCCO) (MCFI)
      • Treasury Counterparty (TRCO)

Read here for further information about SWIFT User Categories.

3. Which SWIFT Messages can the various SWIFT User Categories Send?

  • Supervised Financial Institutions
    • Are able to send/receive ALL message types
  • Non-Supervised Financial Entity active in the Financial Industry
    • Is able to send all message types to Supervised Financial Institutions
    • Is not able to send/receive payment messages to/from other Non-Supervised Financial Entities
  • Closed User Groups
    • Message types that can be sent/received are defined by the administrator of the Closed User Group

4. What is the Admission Process for Joining SWIFT

The procedure for joining SWIFT is a lot more detailed than what i describe below, but to give you an idea… Note the applicant or organisation must register itself as a SWIFT User which:

  • Must meet the criteria indicated within the SWIFT user categories (see above) and comply with the following conditions
  • Be located in a country/nation that is recognised by the international community
  • Must follow the onboarding tool procedures found at SWIFT.com
  • Provide evidence of compliance to the eligibility criteria
  • SWIFT may follow up with local authorities, regulators, etc for additional information regarding your application
  • SWIFT may inform authorities if it believes your application is fraudulent
  • Must sign a SWIFT Undertaking stating that you will follow SWIFT rules
  • Once approved SWIFT will notify the applicant and the representative of the National Member Group of the new SWIFT user
  • The SWIFT User must subscribe to SWIFT services and products within 3 months
  • SWIFT will inform the National Member Group and the Board of Directors of new SWIFT members
  • The National Member Group may validate with the SWIFT user their eligibility criteria
  • Once admitted the SWIFT Users can join National Groups for awareness of SWIFT news
  • SWIFT Users must inform SWIFT of any changes in its legal status / eligibility criteria
  • If SWIFT rejects any application, the applicant will be notified
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5. Which SWIFT Messages can Corporates under SCORE User Category Send?

Corporates under SCORE can send the following SWIFT message types (Ref: MT Message Allowed in SCORE):

Category 1 – Customer Payments & Cheques

  • Corporate to Financial Institution
    • MT 101 Request for transfer
    • MT 104 Direct debit and request for direct debit
    • MT 192 Request for cancellation
    • MT 195 Queries
    • MT 196 Answers
    • MT 199 Free format message
  • Financial Institutions to Corporate
    • MT 195 Queries
    • MT 196 Answers
    • MT 199 Free format message

Category 2 – Financial Institution Transfers

  • Corporate to Financial Institution
    • MT 210 Notice to receive

Category 3 – Foreign Exchange, Money Markets & Derivatives

  • Corporate to Financial Institution & Financial Institution to Corporate
    • MT 300 Foreign exchange confirmation
    • MT 303 Forex/Currency option allocation instruction
    • MT 304 Advice/Instruction of a third party deal
    • MT 305 Foreign currency option confirmation
    • MT 306 Foreign currency option confirmation
    • MT 320 Fixed loan/deposit confirmation
    • MT 330 Call/Notice Loan/Deposit confirmation
    • MT 340 Forward rate agreement confirmation
    • MT 341 Forward rate agreement settlement confirmation
    • MT 350 Advice of loan/Deposit interest payment
    • MT 360 Single currency interest rate derivative confirmation
    • MT 361 Cross currency interest rate swap confirmation
    • MT 362 Interest rate reset/Advice of payment
    • MT 364 Single currency interest rate derivative termination/Recouponing confirmation
    • MT 365 Cross currency interest rate swap termination/Recouponing confirmation
    • MT 370 Netting Position Advice
    • MT 390 Advice of charges, interest and other adjustments
    • MT 391 Request for payment of charges, interest and other Expenses
    • MT 392 Request for cancellation
    • MT 395 Queries
    • MT 395 Queries
    • MT 396 Answers
    • MT 399 Free format message
  • Financial Institution to Corporate only
    • MT 321 Instruction to Settle a Third Party Loan/Deposit

Category 5 – Securities Markets

  • Corporate to Financial Institution
    • MT 502 Order to buy or sell
    • MT 509 Trade status message
    • MT 517 Trade confirmation affirmation
    • MT 527 Triparty Collateral Instruction
    • MT 540 Receive free
    • MT 541 Receive against payment
    • MT 542 Deliver free
    • MT 543 Deliver against payment
    • MT 549 Request for statement/Status advice
    • MT 565 Corporate action instruction
    • MT 568 Corporate action narrative
  • Financial Institution to Corporate
    • MT 509 Trade status message
    • MT 513 Client advice of execution
    • MT 515 Client confirmation of purchase or sale
    • MT 535 Statement of holdings
    • MT 536 Statement of transactions
    • MT 537 Statement of pending transactions
    • MT 538 Statement on intra-position advices
    • MT 544 Receive free confirmation
    • MT 545 Receive against payment confirmation
    • MT 546 Deliver free confirmation
    • MT 547 Deliver against payment confirmation
    • MT 548 Settlement status and processing advice
    • MT 558 Triparty collateral status and processing advice
    • MT 564 Corporate action notification
    • MT 566 Corporate action confirmation
    • MT 567 Corporate action status and processing advice
    • MT 568 Corporate action narrative
    • MT 569 Triparty collateral and exposure statement
    • MT 578 Settlement allegement
    • MT 586 Statement of settlement allegements

Category 6 – Commodities, Syndications & Reference Data

  • Corporate to Financial Institution & Financial Institution to Corporate
    • MT 600 Metal trade confirmation
    • MT 601 Metal option confirmation

Category 7 – Documentary Credits & Guarantees

  • Corporate to Financial Institution & Financial Institution to Corporate
    • MT 798 Trade envelope

Category 9 – Cash Management & Customer Status

  • Corporate to Financial Institution
    • MT 920 Request message
    • MT 995 Queries
    • MT 999 Free format message
  • Financial Institution to Corporate
    • MT 900 Confirmation of debit
    • MT 910 Confirmation of credit
    • MT 940(1) Customer statement message
    • MT 941 Balance report
    • MT 942(1) Interim transaction report
    • MT 950 Statement message
    • MT 996 Answers
    • MT 999 Free format message

 

References:

The post Read This If You’re Thinking About Joining SWIFT appeared first on SEPA for Corporates.

Explained: SWIFT gpi UETR – Unique End-to-End Transaction Reference

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At the heart of the SWIFT gpi initiative is something called the UETR. In this post, i will share everything i know and likely you need to know about the UETR. So let’s jump straight into it…

What is SWIFT gpi?

Before we delve into the UETR, we need to know what the SWIFT gpi is. In a nutshell SWIFT gpi refers to SWIFT’s Global Payments Innovation initiative, enabling:

  • Faster payments – enabling same day use of funds
  • Transparency of fees
  • End to end visibility/tracking of payments
  • Complete and unaltered remittance information

As mentioned above, driving the SWIFT gpi initiative is the UETR….

What is the UETR – Unique End-to-End Transaction Reference?

As stated already the UETR is a Unique End-to-End Transaction Reference. The UETR is:

  • The SWIFT cross border payments equivalent of your parcel tracking number
  • Generated by the Payer and passed through, without modification, the SWIFT network and any intermediary banks through to the Payee (beneficiary)
  • Used within the SWIFT gpi Tracker to enable banks and corporates to track and monitor in real time the end to end progress of all gpi payments

Which Message Types Require the UETR – Unique End to End Transaction Reference?

The SWIFT Standard MT Release 2018 requires you to populate (it is currently optional) the UETR in the FIN user header (block 3) for the following MT messages:

  • MT103
  • MT103 REMIT
  • MT103 STP
  • MT202
  • MT202 COV
  • MT205
  • MT205 COV

What are the UETR SWIFT Format Requirements?

As stated above, the SWIFT Standard MT Release 2018 makes it mandatory for you to add the UETR in field 121 within block 3 of the FIN header.

The UETR (Unique End to End Transaction Reference) must be:

  • Unique – As the name of the field indicates this is intended to be a globally unique value, not just unique to your organisation
    • Adhering to the Universal Unique Identifier (UUID) or Globally Unique Identifier (GUID) which is compliant with IETF standard RFC4122, version 4 of the generation algorithm
    • Follow the link for further details about generating the UUID, Universal Unique Identifier
    • Check out this overview around how to generate a UUID compliant with RFC 4122
  • Assigned by the initiating party
  • Indicated in field 121 within block 3 of the MT header
  • 36 characters – made up to 32 hexadecimal characters, shown in  5 parts divided by hyphens/dashes as follows:
    • xxxxxxxx-xxxx-4xxx-yxxx-xxxxxxxxxxxx
    • Where:
      • x is any lowercase hexadecimal character
      • 4 – fixed value
      • y – either: 8, 9, a, b

Where to indicate the UETR Field 121 in the SWIFT Header Block 3

If you’re new to SWIFT formatting, i would recommend having a read of my earlier post The Structure Of A SWIFT Message, Explained! That post deals with a MT101 header, but the idea is the same. Note, below i have indicated in bold the message type (103). Here is what your existing MT103 header looks like:

{1:F01YOURCODEZABC1234567890}{2:I103YOURBANKXJKLU3003}{3:{113:SEPA}{108:ILOVESEPA}}{4: 

and now with the UETR you must generate something like this:

{1:F01YOURCODEZABC1234567890}{2:I103YOURBANKXJKLU3003}{3:{113:SEPA}{108:ILOVESEPA}{121:xxxxxxxx-xxxx-4xxx-yxxx-xxxxxxxxxxxx}}{4: 

When SWIFT gpi is released to the broader corporate user base, you’ll indicate field 121 in your MT101 header in exactly the same way. Easy peasey, eh?

Thanks for stopping by – Take a look around…!!

What is the Service Type Identifier Field 111?

Field 111 is to be placed in the header section block 3, and is to be used as indicated below by SWIFT gpi members only:

{1:F01YOURCODEZABC1234567890}{2:I103YOURBANKXJKLU3003}{3:{113:SEPA}{108:ILOVESEPA}{111:001}{121:xxxxxxxx-xxxx-4xxx-yxxx-xxxxxxxxxxxx}}{4: 

Couple of things to note:

  • Depending on whether you are a gpi-bank or not, you will either add or drop field 111
  • Values will be:
    • 001 – to be used for:
      • 001 – SWIFT gpi Customer Credit Transfer (gCCT)
      • 001- SWIFT gpi Cover services (gCOV)
    • 002 – will be used in the future for the SWIFT gpi Stop and Recall (gSRP) service
    • ??? – for future services

Okay, I have a generated the UETR – What Next?

  • For the above stated message types, you (banks, corporates, message initiator) must ensure the UETR is generated and indicated in the header (block 3), even if you are not a SWIFT gpi bank / registered institution
  • As a receiving bank you must be able to receive the UETR value in the header block 3 of the MT message
  • If you are an intermediary, you must pass on this UETR value unchanged to the next bank
  • The above requirements are available to test in the T&T (Test and Training) environment right now, and will go live on 18th November, 2018 (based on the annual SWIFT Standard MT Release schedule)

Good luck! 😉

 

Further information can be found at:

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15 Fascinating Leadership Insights by Steve Waugh at Sibos 2018

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I follow cricket, but cannot say I’m an avid fan of the game. Over the weekend, i found myself watching various clips from Sibos 2018, one of which was a Breakfast Keynote by Australian cricketer Steve Waugh. It was a fascinating keynote so much so i summarised the leadership lessons provided by Steve.

A quick overview of Steve Waugh’s Achievements:

  • Captain of Australian cricket team from 1999 to 2004
  • Until 2010 was the most capped Test cricket player in history
  • Scored over 10,000 Test runs
  • Led the Australian cricket team to:
    • 15 of their record breaking 16 consecutive Test wins
    • Win the 1999 Cricket World Cup
  • Awarded:
    • Australian of the Year (2004)
    • Order of Australia
    • ICC Cricket Hall of Fame

You get the idea…!

1. Early Years of Self Doubt, Failure and Glimpses of Success

Despite the successes outlined above, Steve described his early cricketing years of self doubt, failure and glimpses of success. But these failures taught Steve some key lessons from which he was able to learn and grow.

2. In the early years, the Managers job was to make sure the Beers were nice and Cold

How times change! Today the Australian cricket team consists of 17 support staff, including a data analyst. Do you have a data analyst on your team? Do you have meaningful data?

3. Low Expectations lead to Poor Results

In the early years, it was a matter of survival. You need to set your goals high, and you need good leadership to help you navigate the right course.

4. You Need to Change Your Mantra, Your Attitude and Pay Attention to the Details

The Australian cricket team turn-around started in 1987 World Cup in India, where the team were 16-1 outsiders and ended up winning the tournament! For the first time the team took a professional coach (Bob Simpson) who made key changes:

  • Getting rid of players with a poor work ethic and little commitment to the team
  • Practicing in heat conditions
  • Increased fitness levels
  • Focused on skills
  • Looking after one another
  • Monitored food and fluid consumption
  • Ensured punctuality
  • Analysed the opposition using video

5. Set Yourself some Goals as a Team

Pretty simple, really. The players wanted to be the best team in the world – Test cricket and 1-Day cricket.

6. Respect the Past, Create Your Own Future and Leave Your Own Legacy

This is interesting, Steve talks about respecting the past and following in the footsteps of past leaders. But equally important is to create your own future and leave your own legacy. Each cricket match was seen as an opportunity to do just that – to improve and set the bar higher.

An ethic was created whereby each victory was assessed, reviewed and improved upon. Ultimately the players wanted to reach their full potential.

7. Don’t be Complacent – Imagine Yourself as the Number 2 Side

Train and prepare like you’re the number 2 side. Never under-estimate your opposition and continue to push yourself and each other.

8. Enjoy each others company, have a sense of Passion and Fun

This Steve suggests is often forgotten, and when your in a team, you need to gel together and enjoy each others company. Steve warned, if you don’t do this, its going to be a long day at the office!

9. Take a Successful Blueprint from others, and Tweak it

For the Australian team it was by looking at the successful and unbeatable West Indies team of the 1980s which possessed:

  • Strong body language
  • Played with positive intent
  • Created a powerful media image of themselves

Steve talks about “Smart people learn from smarter people and better organisations and tweak it to suit themselves”. The Australian’s tweaked the blueprint by “putting constant and relentless pressure on their opposition by exerting excellent skills”.

10. As a Leader Dynamics Changes and You Need to Make Tough Decisions

Dynamics change such that as a leader people will treat you differently. Initially Steve explains how he tried to lead by consensus and please the team – but as the saying goes – you cant please everyone all the time and need to trust your instincts and your own morals.

You’re picked as a leader to make tough decisions.

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11. As a Leader you want to be Liked & Respected, to be Respected is most Important

This was exemplified in the unpopular decision Steve made in dropping Shane Warne, one of the all time great cricketers, during a crucial Test match. The unpopular decision and huge risk paid off, and the team won the match.

If you make a mistake, take responsibility for it. Be yourself, don’t copy others and make it your mistake, own it. Take responsibility, you will learn and grow from it.

12. You Need Loyalty to your Organisation and Team

The above example was a decision on behalf of the team, and the emotional and personal relationships within the team had to be put on to one side.

The current climate can sometimes demand instant success and when this doesn’t transpire, there is often an immediate need for change. This can lead to the loss of the character of an organisation and self belief in individuals. Knowing that their head is on the line can lead  individuals to put their needs ahead of the organisation and in the long term this can be a problem. There needs to be room for some mistakes and flair – see below – but to a point!

13. Treat People Equally but Differently

There are non-negotiables, see point 4 above, but you need to recognise and make space for individual flair and charisma of individual players and allow them to play their own game

14. Maximise Peoples Potential by putting them out of their Comfort Zone

Often people don’t know what they are capable of until they are put in a certain situation. Sometimes people can just do things when they don’t over-think the situation too much.

Steve goes on to explain that you need to put in the hard work and lay a good foundation. This allows you to be calm under pressure, and when you’re put under stressful conditions you’re not hoping you can deal with the situation, you have the confidence and know you can deal with it!

15. Attitudes are Contagious, Is Yours Worth Catching? – Steve Waugh

Steve explains this was about perception. Do you want to be seen as a role-model and others to follow in your footsteps? Are you positive, trying to improve and become a better person?

While life is about persistence and perseverance, often it boils down to your attitude. Positive body language, purpose and intent will flow across your personal and business life.

 

Inspiring stuff, eh?

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4 Considerations for Your SWIFT for Corporates Business Case

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Last week Deloitte released an interesting report – SWIFT for Corporates: The real value and cost of connecting to your banks via a single window – which i reviewed and made some notes on. The report provides an interesting insight for companies that maybe considering SWIFT as a connectivity solution, and also a reminder for existing corporates around SWIFT benefits and connectivity options. Please do read the Deloitte report for full details, following are my notes.

Why SWIFT for Corporates?

The challenges for corporates:

  • Many banking partners across their business operations (country/region/global)
  • Many bank communication channels
  • As a result of the above
    • Many bank interfaces
    • Many different ways for end users to interact with their banking partners creating operational burden
    • Many interfaces that need to be supported, maintained and upgraded across your organisation

How SWIFT can help:

  • SWIFT provides a single, secure and reliable (99.999% availability) connectivity channel that can be used globally (over 200 countries) with most banking partners (about 11,000) and uses standardised financial messaging
  • ERP systems and Treasury Management Systems (TMS) can be configured to link through to the SWIFT channel – which enables business processes to be simplified and automated – removing the need for manual processing
  • Better security –
    • As cyber security threats increase, SWIFT propose they are investing heavily to ensure the best security measures/controls are implemented – SWIFT also have a Customer Security Programme to help reinforce controls at their customer environments
    • As you remove manual processing across your organisation, you reduce the ability for users to manipulate payment files
  • Scalability – As you deploy SWIFT connectivity, you’re able to re-use and expand the single connection to the SWIFT network to add new countries, banks, payment types

Source – SWIFT For Corporates: Multiple versus Single Bank Connectivity Channel

SWIFT For Corporates: Connectivity Options:

In short, there are 4 ways for corporates to connect to SWIFT:

  • Alliance Lite 2 – SWIFT’s cloud solution
  • Lite 2 for Business Applications (L2BA) – SWIFT integration through a business application (ERP/TMS) – plug and play
  • Alliance Access – SWIFT’s on premise gateway, Alliance Gateway
  • Service Bureau – SWIFT connectivity via a third party

 

SWIFT Connectivity Options for Corporates

Source: Deloitte – SWIFT for Corporates: The real value and cost of connecting to your banks via a single window

SWIFT for Corporates: Costs

This is really interesting analysis by Deloitte. Deloitte explain each organisation will have different costs depending on the number of banks, countries, payment types, ERP systems…. the list continues. But the following gives you an idea of the different costs involved:

  • SWIFT messaging costs
    • SWIFT has 2 main messaging channels –
      • FIN – uses the SWIFT MT Standards to send urgent/high value (MT101) payments to banks
      • FileAct – used to send payments in various file formats-  such as ISO20022 XML / bank proprietary
    • Corporates will be charged for payments sent via the SWIFT network, inbound reporting messages (such as bank statements) delivered over the SWIFT network will not incur a SWIFT charge, although you should be aware that:
      • Banks may charge a processing fee
      • Your SWIFT service bureau (if you so choose) may charge a delivery fee
    • Deloitte analysis indicates a cost of around €170 EUR per message
  • Connectivity method costs
    • Alliance Lite 2:
      • Installation cost: €15,000 – €20,000 EUR – hardware, software, integration
      • Annual costs: €6,000 – €15,000 EUR – based on volume
    • Alliance Lite 2 for Business Applications (L2BA):
      • Installation cost: €15,000 – €20,000 EUR – hardware, software, integration
      • Annual costs: €6,000 – €15,000 EUR – based on volume
      • Consider: The business application provider will likely charge a fee to maintain/support the infrastructure
    • Alliance Access:
      • Installation cost: €65,000 – €85,000 EUR – hardware, software, integration
      • Annual costs: 20-30% – based on software maintenance, support, volume, type of integrations
      • Consider: 0.25-1 full time employee will be required to support, operate and monitor the infrastructure
    • SWIFT Service Bureau
      • Onboarding cost: €20,000 – €40,000 EUR
      • Annual costs: €15,000 – €35,000 EUR for maintenance, support
    • Bank Fees
      • Keep in mind bank costs will likely exist for other connectivity methods, not just for SWIFT
      • Onboarding cost: €0 – €3,000 EUR
      • Annual costs: Depends on factors such as number of accounts, volume

SWIFT for Corporates: Some Interesting Facts

Check out the Deloitte report for full details and stats, but in short:

  • SWIFT as a communication channel is not solely for large corporates, but should be considered by smaller (revenue less than 0.5 billion USD) companies too
  • SWIFT implementations are increasingly using the Alliance Lite 2 and Alliance Lite 2 for Business Applications – ensuring a ‘light’ IT infrastructure footprint
  • Corporates with a variety of banking partners are using SWIFT, not just those with many (more than 10) banking partners

 

 

The report from Deloitte is a good read, and reiterates the importance of SWIFT as a single and multi-bank connectivity channel. If this is of interest to you, you read joining SWIFT, the benefits of SWIFT and why SWIFT ain’t a magic bullet. Happy Reading!

The post 4 Considerations for Your SWIFT for Corporates Business Case appeared first on SEPA for Corporates.

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