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SWIFT Access Service Powers Improvements at National Grid National Grid was looking to improve security and process efficiency for its high value payments whilst providing a scalable foundation for future treasury projects such as introducing a new treasury management system (TMS). We find out how they achieved this.

SWIFT Access Service Powers Improvements at National Grid

by Mark Flawn, Assistant Treasurer, National Grid plc

National Grid was looking to improve security and process efficiency for its high value payments whilst providing a scalable foundation for future treasury projects such as introducing a new treasury management system (TMS). To achieve this, we needed to introduce a more flexible and resilient treasury infrastructure that was capable of providing greater visibility over account balances to enhance cash management and enable us to further leverage straight-through processing opportunities.

Treasury background

Our treasury department manages a £20bn debt book and is responsible for managing a large number of banking relationships. In the past, this has involved using different ebanking platforms, terminals and security devices. Making payments and receiving balance and transaction information that could be consolidated into an accurate picture of our true cash position was a highly manual and complex process.

Although cash is predominantly held in GBP and USD, we also operate in a number of other currencies. Treasury payment volumes are low but are typically high in value. Security, efficient payment processing, reporting and greater visibility over account balances, wherever they are in the organisation, is therefore vital to our ability to manage cash effectively.

With several hundred bank accounts, the manual processing involved in obtaining balance and transaction reports restricted cash management flexibility. We realised that investing in our payment processing infrastructure could potentially lead to significant benefits. We took advice from our main banking relationship provider, Barclays, who recommended SWIFT connectivity to provide a single communications platform for financial messaging.

Selecting a partner for SWIFT connectivity

Once we had identified SWIFT connectivity as a key element of our proposed treasury infrastructure, we needed to decide on the best way to implement it. We recognised, however, that we lacked specific SWIFT expertise. We therefore developed a business case for a cloud-based solution from a SWIFT service bureau based on the advantages we would achieve, including accurate balance and transaction data, greater security and operational efficiency.

Having ruled out the option of building and maintaining an in-house connection to SWIFT, we conducted a detailed evaluation of SWIFT service bureaus. Based on this evaluation, we decided to outsource SWIFT connectivity to Bottomline Technologies’ SWIFT Access Service, for the following reasons:

  • We were impressed by the company’s accreditations and credentials in the SWIFT space. Their cloud-based bureau was already in use in other high value corporate payment scenarios.
  • Bottomline also received a strong endorsement from Barclays. We therefore had confidence that they were the right strategic partner for us and could meet our long- term SWIFT connectivity requirements.
  • It fits with the strategic initiative at National Grid treasury to use remotely hosted solutions where possible. We are able to achieve better results by using a cloud platform as it removes the overhead of maintaining the infrastructure on our own servers which in turn frees up both our treasury and IT resources.

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