Published: September 29, 2014
In last year’s edition of TMI’s SWIFT Connectivity Guide, we outlined the pillars of SWIFT’s 2013-2015 strategy for corporate access: easing connectivity; pioneering standardisation; promoting industry-wide security and facilitating trade flows. A year on, substantial progress has been made in enabling corporate treasurers and finance managers across a wide spectrum of organisations to improve the security, reliability and efficiency of their financial operations.
Our underlying strategy for supporting the corporate community is straightforward: to be the preferred secure network for multi-banked corporates globally. While early adopters were large multinational corporations, the value and applicability of SWIFT is by no means limited to these organisations. The demands of globalisation, counterparty risk and sharing wallet across funding banks mean that that there are few corporations that are not becoming multi-banked. Consequently, over recent years we have redefined our value proposition to deliver more integrated service offerings that are easily adopted and cost-effective. The aim is to reinforce our ability and commitment to supporting corporates, both directly through our connectivity services, and indirectly by assisting banks and vendors to deliver innovative, automated and standardised services for treasury and trade.
The opportunity to access products and services via cloud-based solutions is revolutionising the way that corporate treasurers connect with their banks. Not only has Alliance Lite2 become the most popular connectivity option for new customers using SWIFT to access their banks, but this is also now becoming embedded into SaaS (software as a service) solutions for both treasury (such as BELLIN) and trade (such as GTC).
Cloud-based connectivity, particularly when integrated as part of a wider treasury or trade solution, dramatically reduces treasurers’ and finance managers’ reliance on internal IT teams, who now need only to approve, rather than manage and maintain, specialist applications for cash, trade and bank connectivity. Furthermore, by integrating connectivity within a wider solution, implementation can be completed more quickly and easily. Increasingly, multi-bank connectivity via SWIFT will therefore become an integrated part of treasury and trade management solutions, supporting corporates’ financial processing, management and connectivity requirements through a single access point.
One of our objectives at SWIFT is to facilitate every transactional exchange between a corporation and its banks. While there has been an emphasis on automating and standardising treasury flows in the past, the same potential exists for trade flows. Historically, many of these transactions have been conducted manually, but comparable opportunities exist for trade as for treasury, such as the use of MT798 messages for documentary credits. There is a growing number of corporations using SWIFT for trade, some of whom, such as Volvo and GE, will be discussing their experiences during the Corporate Forum at Sibos. One of the barriers to digital trade is that there remain some limitations in banks’ level of readiness for electronic, rather than paper-based flows, an issue that we will be addressing at the Corporate Forum, including demonstrating how digitisation can help tackle some of the pain points that banks currently encounter, and how to enhance service offerings to customers.[[[PAGE]]]
Corporate users are becoming increasingly engaged in defining and prioritising new solutions and services available via SWIFT, such as through the CGI (Common Global Implementation) Group. The CGI provides a forum for banks, corporates, vendors, SWIFT and other industry participants to define priorities in bank connectivity and related services, and establish guidelines on the use of ISO 20022.
In 2013, we anticipated that 50% of multi-banked corporates would be connected to their banking partners via SWIFT by the end of 2015, including those accessing SWIFT via an integrated cloud-based treasury, trade or payments solution. More than 40% of FT500 corporations are already leveraging SWIFT for bank connectivity, across a wide spectrum of company sizes and industries. This has given rise to a growing range of services that have been developed specifically to meet the needs of the corporate community, such as 3SKey (personal digital signatures) and eBAM (electronic bank account management). As opportunities to access SWIFT increase, and the range of services continues to be enriched, the benefits for corporate users of SWIFT will grow further. By engaging in discussion and debate at this year’s Sibos Corporate Forum and EuroFinance Budapest, treasurers and finance managers can shape the future of the industry and input to the innovations of the years ahead.
For more information on SWIFT for Corporates, please go to www.swift.com/corporates
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