Swift Connects Instant Payment Systems to Bring Round-the-Clock Processing Across Borders

Published: November 30, 2023

• Go-live of EPC scheme enables 24/7 instant payments across currency zones
• Swift provides end-to-end traceability
• Interlinking market infrastructures is key to achieving G20’s goals for cross-border payments

Brussels – Cross-border payments destined for Europe can now reach beneficiaries in seconds through seamless connection to instant domestic payment systems, with full transparency and end-to-end tracking powered by Swift.

The European Payment Council’s One-Leg-Out Instant Credit Transfer scheme (OCT Inst), which went live this week, enables payments to and from Europe to be processed 24 hours a day, seven days a week. The go-live follows on from a successful proof of concept earlier this year in which Swift collaborated with Iberpay, the European payment system; Spanish banks BBVA, CaixaBank and Santander; and commercial banks from Australasia (ANZ and the National Australia Bank), Brazil (Itaú Unibanco) and the UK (Lloyds Banking Group), with dozens of international payments successfully reaching Spanish accounts within seconds.

Interlinking market infrastructures in this way is a key method by which to achieve the G20’s goals for cross-border payments around speed, transparency, cost and access. Swift announced earlier this year that 89% of payments on its network reached the end bank within an hour. The G20 is targeting 75% of cross-border payments to be credited with the beneficiary within an hour by 2027. OCT Inst is seen by financial institutions as an opportunity to leverage the benefits of domestic instant payment systems globally, while enabling outgoing flows and using existing rails.

Marianne Demarchi, Chief Executive of Swift in Europe, said: “Interoperability is at the heart of everything we are doing at Swift to achieve our strategy of instant and frictionless payments for all, and it will be key to achieving the G20’s goals for cross-border payments. The EPC’s OCT Inst scheme is a positive step for Europe that will enhance the user experience for payers in Europe, but also all around the world.”

Swift is closely monitoring and engaging with other interlinking initiatives and considering how they could take advantage of Swift’s solutions. For instance, forthcoming European legislation for instant payments directs payment service providers to offer instant payments at the same price as traditional payments, while also mandating them to check beneficiary details before a payment is initiated. Connecting domestic Confirmation of Payee schemes - which are effective in tackling instant payment fraud - with Swift Payment Pre-validation, will enable institutions to comply with this legislation by checking beneficiary details across the Eurozone without needing to reinvest in a new product.

In September, CBI, the Italian company that develops digital services, including open banking and open finance services, announced that it was extending its Confirmation of Payee service (Name Check CBI) to the European level through connection with Payment Pre-validation.

Executives from the international payments community have praised the scheme, saying it is “instrumental for reaching the G20 objectives” and that interoperability between cross-border and domestic payments is “a critical pillar” in the journey to instant and frictionless payments.

Carmen Rey Poza, Swift Global Product Owner at Santander, said: “This initiative leverages existing rails and connections, so there’s no need for big developments and investments, and offers not only the much desired ‘instantaneity’ but also the capacity to track your payments. It will improve significantly the customer experience for both senders and receivers.”

Rogerio P. Galvão, International and FX Services Operations at Banco ITAU Unibanco SA, said: “We are glad to take part in this project and contribute to the community. We would like to highlight that the project enables the opportunity to make transfers beyond the cut-off time of EUR currency time zone, which is very useful especially for the Americas market, and increases the speed of credits to a beneficiary’s accounts. Furthermore, all tests were done without changing of standard message format. We look forward to having this great project in production.”

Luke Perkins, Head of Global Cross Border Payments & Core Transaction Product at ANZ, said: “ANZ is committed to working to enhance cross border payments for our customers. The European market is an important region for our customers, and we’re encouraged by the commitment from this pilot group to test and learn to help ensure cross border payments are fast, frictionless and trackable across the globe. Interoperability with domestic instant payment networks is a critical pillar in this journey and this testing continues to highlight the enhancements possible for cross border payments by integrating with these networks. Europe has traditionally been a complex marketplace for banks outside the Eurozone, and at ANZ we look forward to seeing this capability introduced to the wider market for the benefit of customers world-wide.”

Raouf Soussi, Head of Payments Strategy at BBVA, said: "With this initiative, combining Swift GPI & real-time payments, we are finally giving our customers an unbeatable experience in the world of cross-border payments."

Jonathan Adams, Executive, Transaction Banking Product at National Australia Bank, said: “We’re thrilled to be playing an active role in the evolution of the global payments landscape. Our personal and business banking customers have high expectations for easy, cost effective and real-time transactions and every uplift in the international payments ecosystem brings us closer to delivering more simple and safe global banking solutions.”

Damien Godderis, Head of Payments Industry Engagement at BNP Paribas, said: “BNP Paribas strongly believes in the OLO concept and hopes that other markets, on top of the UK, Australia and Europe, will follow the same approach. This is instrumental to reaching the G20 objectives and to allow interoperability between cross-border payments, as well as between market infrastructures. The Spanish initiative with Iberpay is a good example of how this model provides access to the Spanish community. We strongly hope a similar approach will be seen in other European Communities.”

Giorgio Andreoli, Director General of the European Payments Council, said: “The new One-Leg Out Instant Credit Transfer scheme is the first non-SEPA scheme delivered by the EPC, targeting international (instant) cross border A2A transactions. The OCT Inst scheme leverages the large and growing base of European PSPs already supporting Instant Payments, 62% in the SEPA area, adding on top of the speed, low cost and reachability already provided by the SCT Inst scheme, the transparency and traceability required by the G20 and the FSB. The EPC is proud to be releasing at the right point in time an innovative scheme with a strong market fit, as we believe that a multilateral scheme approach will be a game changer for international instant payments.”

Juan Luis Encinas, CEO of Iberpay, said: “This world first pilot service, involving Iberpay’s payment system, the Swift GPI Tracker and many international banks, aims to improve and optimise international cross-currency payments in terms of speed, transparency, cost-effectiveness, availability and accessibility, and sets the stage for enhanced user experiences, novel use cases and innovative services. Iberpay’s participation in this pilot service underscores our commitment to pioneering advancements in cross-border payments, aligned with the strategy and goals of international organisations such as the G20, Financial Stability Board, Bank for International Settlements, the European Commission and the International Monetary Fund, among others.”