A new era for financial transactions worldwide
What is ISO 20022?
ISO 20022 is an alternative to SWIFT MT financial messaging, replacing ISO 15022 as the de facto international communication standard for domestic and international financial transactions.
Did you know ISO 20022 has already been adopted in over 70 countries, with major banks and financial networks making the switch as we speak?
ISO 20022’s unified language framework streamlines financial messaging across banking institutions and market infrastructures worldwide, making financial transactions safer, faster, and more reliable.
Impact of migrating ISO 20022 on your business
ISO 20022 is ready to meet the challenges of modern markets and unlock a world of opportunities for both financial and non-financial institutions.
Handle increasingly complex financial transactions and standardize, streamline, and accelerate associated communications.
What does it look like for your business?
- Deliver an enhanced and seamless customer experience with a highly user-friendly interface
- Manage data-rich transactions using a more structured and productive method
- Process complex transactions faster, more accurately, and with increased precision while generating easily shareable data and information
- Improve financial reporting and compliance
- Reduce errors in transaction processing and messaging, effectively lowering risk and costs
- Drive workflow and supply-chain efficiency
- Bolster fraud prevention and compliance with AML regulations
- Save time spent on manual checks, driving STP rates higher
- Explore a wide array of transaction management services
- Gain greater transparency into payment infrastructures
Migrating to ISO 20022: A needless inconvenience or a necessity?
Financial Institutions are better off migrating sooner rather than later, but why?
ISO 20022 adoption is being led by mature financial communication systems, such as Real-Time-Payments (RTP) and SWIFT. Some have already mandated adherence to ISO 20022 standards, while others, like SWIFT, have implemented migration timelines to help businesses make the transition over time.
Regulators, payment service operators (PSOs), and payment service providers (PSPs) are also supporting and encouraging ISO 20022 adoption worldwide. Financial Institutions have until November 2025 to transition before most international financial sectors complete their switch. With respect to SWIFT, beyond this deadline, you will not be able to conduct financial transactions using the outdated ISO 15022, Categories 1, 2 and 9 financial messaging standards.
As such, it is fast becoming a necessity.
Getting ready to make the switch to ISO 20022
Here are just a few preliminary steps to prepare yourself for the migration:
- Analyze existing transaction traffic and identify the type of messages that typically flow in and out of your system.
- Determine the type of support your system provider can offer if your core system is externally managed. You should also ask your systems provider if they charge to integrate your current system with ISO 20022.
- Evaluate your internal capacity to handle the integration.
- Understand and anticipate migration costs according to the core system you have in place because changing and updating legacy systems can be cost-intensive.
- Ensure you plan, configure, test, and execute your connectivity to be ready to connect with the SWIFT infrastructure following the migration
ISO 20022 simplified by Axletree
Our robust, secure, and reliable enterprise financial messaging solution provides any-to-any format translation and integration for all payment and financial connectivity systems.
By deploying Symmetree, you can effectively convert all your financial transaction processing and messaging into and from ISO 20022’s format automatically, without having to change your existing back-office and core systems. The ability to both transform the incoming and outgoing ISO 20022 messages, not just between now and 2025 but beyond, is vital for any financial institution.
Designed and offered as a SaaS solution, your organization can unlock key benefits like:
- Effortless integration of back-office applications
- Effective processing of payment instructions, confirmations, and statements
- Efficient communication with all your counterparties
- Automated communication processes
- Expertly managed payment connections, formats, and rails
- Accelerated time-to-market
- Single window end-to-end visibility into all your integrated systems
Integrating your back-end financial transaction management system with Symmetree is the most efficient route to ISO 20022 migration, helping you avoid the risk of integration incompatibilities that come with internal migration and the cost and risks associated with external migration.
Your seamless ISO 20022 migration just a click away
To find out more about SWIFT ISO 20022 migration readiness and deploying Symmetree by Axletree to secure complete peace of mind before the SWIFT 2025 migration deadline, get in touch with our team today.
The Who, the What and the How of SWIFT’s ISO 20022 migration
What is changing with SWIFT’s ISO 20022 migration?
ISO 20022 messages will replace message types developed under an older standard, ISO 15022 (SWIFT FIN messaging). These MT message types have been used by the SWIFT community and been ubiquitous for nearly half a century. SWIFT’s deployment of the new ISO 20022 standard is known as MX messages.
What are the benefits to the SWIFT community of migrating to ISO 20022?
Financial Institutions cite the following benefits of migrating to ISO 20022 messages for payments and statement reporting:
- Flexibility – adapts to changes more easily
- Faster and enhanced payment processing – more details in a payment instruction and reporting, will minimize delays caused by requests to originators for further details and clarifications.
- Straight-through processing – better data leads to less manual intervention and greater efficiency and cost saving.
- Harmonization – since its inception, ISO 20022 has been adopted in the payment rails of over 70 countries
- Compliance and regulation – richer data aids transparency and tracking of transactions
- Resilience – interoperability allows rerouting without loss of data
- Enriched data – better and more complete reference information
- Competition and innovation – fueled by flexibility
- Analytics – improved decision-making based on better data
Who is affected by SWIFT’s ISO 20022 migration?
The 2022 migration by SWIFT impacts financial institutions exchanging Categories 1,2 and 9 for cross border payments and statement reporting. Future releases are expected to involve Corporates as well, but the November 21, 2022 migration will only impact financial institution to financial institution messages.
How does the ISO 20022 migration by SWIFT affect your organization?
If you are a Financial Institution sending or receiving SWIFT MT messages in Category 1, 2 and 9, then you will have to adapt your workflows to the new ISO standard. These changes are likely to impact not only the payments processes, but also compliance, risk management, reconciliations, confirmations, cash management, liquidity management and other business functions. While there will be a three-year co-existence period, some SWIFT set-up and internal systems changes are necessary right away. This in order to manage through the co-existence period, whether a bank is migrating to MX from November 21, 2022 or intend to continue the use of MT messages for a while. At a minimum, you will need to reconfigure interfaces for the new SWIFT rail FINplus, update your counterparty permissions (RMA) and be ready for the management of multi-format messages. As such, it is imperative for all financial institutions using these messages to fully understand how the SWIFT MT to MX migration will impact them, how they can reconfigure their systems for proper routing to, and processing by, their back-office applications. This needs to be defined before the November 21, 2022 cutover. Axletree has a team of experts who can advise on proper analysis, planning, testing and final execution of this migration.
What are your choices with regards to the ISO 20022 migration?
As identified, doing nothing is not a viable strategy! You have to analyze your payment flows and identify how to manage the impacted messages by November 2022. Various tools to manage routing and transformation are being put in place, by both SWIFT and service providers to facilitate the co-existence and possible transformation. One option is to partner with a provider who can assist with the transformation of the SWIFT MX to MT or MT to MX messages as well as integration with your back-office system either short or long term. Most organizations will find that they either need to adapt their systems to the new messaging standard directly, or leverage an integration layer to facilitate the transformation or processing of multi-format messages. Axletree has the expertise and tools to assist you!
How can Axletree Solutions help you with the ISO 20022 migration?
In summary, to prepare for the mandatory ISO 20022 migration, you need to be able to manage multi-format or migrate to MX messages. Regardless of your short-term approach, you need to have a plan for ultimate migration to the ISO 20022 format by November 2025. We would recommend that you take this as a catalyst to update your payment systems strategy or refresh your integration or wire processing platform. All financial institutions on the SWIFT network will need a roadmap for their ISO 20022 solution.
The ISO 20022 modernization offers significant opportunities for cost efficiency, improved straight-through processing, richer payment data and enhanced, interoperability which provide. sustainable and long-term capabilities
Axletree Solutions can address the complex challenges of ISO 20022 migration programs with minimal impact to existing systems. We have both the right team of experienced consultants who can help with the ISO 20022 migration, and a flexible technical solution to meet your needs both now and in the future as updates occur. This solution can facilitate not only the financial messaging translation and integration of MT and MX messages but also any-to-any format translation and flexible reporting.
We are here, well-qualified with the right level of expertise and technical abilities, ready to embark on this journey with you!