Published: October 01, 2009
Our conversations with corporate treasurers in recent months have highlighted three main concerns: firstly, global cash visibility. How much cash do you have and where is it? Secondly, you may be re-examining your approach to risk diversification. Over recent years, many corporates have tried to reduce the number of banking relationships they maintain, but today’s uncertain times may call for diversifying risk across a larger number of banks again. Thirdly, you may be looking to maintain access to credit as individual financial institutions tighten their lending criteria.
Today, more than 400 corporates globally use SWIFT, with more than 900 banks in over 100 countries.
In partnership with banks and application providers, SWIFT connectivity is one way in which corporate treasurers and finance managers can effectively address these concerns, with many companies achieving a significant return on investment. One SWIFT connection gives direct access to a broad number of banks across multiple geographies and allows you to exchange information in a standardised way. You can leverage SWIFT to receive regular statements and intraday updates in a consistent way across all your banks, thereby providing better cash visibility and enabling you to better manage risk. Ensuring appropriate access to credit may require an expansion in the number of banking relationships. Here too, a single standardised gateway performs a valuable function.
Today, more than 400 corporates globally use SWIFT, with more than 900 banks in over 100 countries. Air France, Chevron, eBay, Google, Nokia, LG, Samsung, Siemens, Tesco, UPS and mid-size companies such as Alten, Belcorp and Décathlon are among those adding their names to the list of corporates on SWIFT. These corporates range in size and stretch across multiple industries and regions.
While 2007 was an ‘eye opening year’, 2008 was a ‘breakthrough’ year. We focused on broader adoption with easier, lower cost connectivity options. Here’s a look at the facts and figures:
Increase in traffic
In particular, transmission of bank statements has significantly grown – an indication of how useful this information can be in the present environment. More corporates are using FileAct and traffic has increased substantially since the release of a new pricing scheme in 2008. Traffic growth comes from both new users joining as well as existing users further leveraging their SWIFT connection.
Alliance Lite
Alliance Lite was launched at Sibos in 2008 as a convenient and low-cost connectivity option and corporates are amongst those now seeing the benefits. Alliance Lite complements the existing service bureau and member concentrator offerings for smaller companies or those with less complex connectivity requirements.
New services
We added more value and the offering to corporates has evolved. Beyond standard cash and treasury management services, new bank services are now available: exceptions and investigations, secure mail and trade messaging.
Broader community support
Banks are increasingly active in promoting SWIFT for corporates – Barclays, BNP Paribas, HSBC and Unicredit published their experience in the form of case studies and a host of other banks organised roadshows. More than 900 banks, in 100 countries, now exchange traffic with corporates on SWIFT. Likewise partners continue to extend their SWIFTReady applications and are active in case studies, media interviews, webinars and conferences.
Over 630 participants attended the 2nd Sibos Corporate Forum in Vienna. UniverSWIFTNet Paris was likewise a formidable success and we were pleased to participate in a number of other key industry conferences around the world including AFTE, ACT, AFP and EuroFinance. In addition, our new online dialogue platform, swiftcommunity.net for corporates, now has over 1,000 members sharing ideas. [[[PAGE]]]
Where do we go next?While our goal in 2008 was to raise awareness, in 2009, our aim is to help position our users for growth during tough times. Today’s turbulent financial landscape calls for community co-operation. Four main axes will drive our strategy in 2009 to make SWIFT accessible for as many corporates as possible:
1 – Industry mobilisation
We will see a significant number of banks and partners integrating SWIFT for corporates into their portfolios as ‘business as usual’. Mobilisation and co-operation across geographies is critical to ensure that corporates have an integrated solution in their quest for visibility and more flexible technology. Across the board, we are moving from a ‘why’ SWIFT for corporates to a deeper level of education on ‘how’ to best leverage the infrastructure.
2 - Easy and low cost connectivity
I have already heard encouraging stories from corporate users of Alliance Lite who have gone live in only a few weeks, with a price tag starting as little as a few hundred euros a month. The convenience of Alliance Lite extends to new, standardised contractual templates, stronger message standardisation and easier on-boarding. A new website with re-usable information to help build the business case for all stakeholders will shortly be launched.
In June 2009, it was agreed at the SWIFT AGM to expand the SCORE eligibility criteria, so that any corporate will be eligible to join SCORE. To do so, a corporate simply has to be recommended by an existing SCORE bank located in a FATF (Financial Action Task Force) country. This means that the bank expresses a willingness to exchange traffic with that corporate over SWIFTNet. Corporates using FIN will be able to join SCORE immediately; for those using FileAct and InterAct, it is envisaged that the new criteria will apply from the second half of 2010. In the meantime, corporates using FileAct can connect to SWIFT through SCORE or one or more MA-CUGs according to the current criteria.
3 – Value in services
Expanding upon the current offering, ISO reporting will be live and Electronic Bank Account Management (EBAM) is expected to become a reality. Increased standardisation and ISO 20022 XML take-up remains a priority. In addition, we will also support banks and partners in promoting and enabling the new services launched at the end of 2008 (e.g. trade finance and exception and investigations).
4 - More corporate segments
So far, we have mainly targeted very large corporates. Increasingly, banks, vendors and SWIFT are getting ready to move to the mid-market. Several initiatives are ongoing and we anticipate that a number of companies in France will seek SWIFT connectivity when the current protocol for mid-size corporates, Etebac, becomes obsolete.
Industry mobilisation, easy and low-cost connectivity, value in services, more corporate segments: these are our goals for 2009. The year promises to be challenging, yet we see it as an opportunity. Our banks and partners will be instrumental in bringing more corporates on to SWIFT. HSBC is one shining example of a leading bank on SWIFT for corporates. As the main sponsor of UniverSWIFTNet 2009, a partner of the Sibos corporate forum, HSBC has shared its experiences with SWIFT as a case study profile and is continuously engaged in working with us to evolve the offering.
For more information, visit www.swift.com/corporates and join the dialogue on www.swiftcommunity.net/corporates
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