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Birchford launches ISO 20022 translation platform for domestic, ACH, real time , high value and cross-border payments

Team Birchford

January 27, 2022

Most of the banks, despite the many advantages, have not actively considered migrating to ISO 20022 standards, in part because it is not a mandate. In light of recent developments, such as SWIFT's own migration timeline, market infrastructure transition to real-time payments, and the rapidly evolving open banking ecosystem, banks are now prioritizing ISO 20022 migration agendas.

Key Facts about SWIFT ISO 20022

ISO 20022 is a standard for exchanging electronic messages.

Uses XML syntax and offers structured, rich data.

Already used by many real-time, low-value, and high-value clearing systems around the world.

Offers richer references and improved remittance information.

Major currencies will be operating with ISO before 2025 to reap the benefits.

Risk and compliance teams will also benefit from the highly structured ISO 20022 data, providing visibility into payment origination and departure.

Financial institutions can leverage ISO 20022’s increased interoperability to increase efficiency while reducing costs and exposure to risk. Improved data quality, enhanced STP and reconciliation, and higher automation enables the development of value-adding ISO 20022-based services and effective fraud-detection methods. SWIFT estimates that if announced deadlines are met, 79% of high-value payments by volume and 87% by value will already have migrated to ISO 20022 by 2023. The time to act is now, those who continue to prolong migration efforts could risk missing the variety of benefits associated with early adoption.

ISO 20022 migration challenges:

Legacy Infrastructure

The diversity and complexity of ISO 20022 migration present major challenges for banks, payments companies, and corporations relying on legacy infrastructure. Some outdated systems are unsuitable for the new standard. Financial institutions may need to invest in a complete technological transformation to use new message processing capabilities.

Cost & Effort to remodel

To capture ISO 20022 opportunities, industry players need to make sure that their clients and employees have a thorough understanding of the new standard through education, management, and monitoring. This involves extra cost and time and financial institutions must decide if they will solve their lack of ISO experience by hiring top talent that is required for a project of this impact or if they will outsource this undertaking.

To Overcome Challenges: Rely on Our Experts at Birchford:

An initial priority for many financial companies should be to evaluate their long-term strategy and work with payments software providers to kick-start their ISO 20022 migration early. With an early start, institutions can fully understand and capitalize on the benefits of the new standards and roll out streamlined processes, efficient products, and enhanced service before their competitors.

By late 2022, banks and financial institutions globally will migrate from legacy SWIFT MT financial messaging system to the highly structured and data-rich ISO 20022 standard.

Over 70 countries have already adopted ISO 20022 including Switzerland, China, India and Japan. And with over 200 payment types in scope, ISO 20022 allows the harmonization of formats and data components from different payment methods that could not previously work together.

Birchford delivers ISO 20022 migration consultation and translation products globally, with years of SWIFT standards experience, our industry experts will ensure your migration efforts are conducted both seamlessly and securely, with no impact to your customers.

Download Brochure of our Bridged ISO 20022 Translation Platform