The other week SWIFT published a release titled Transforming the business of banking. The article gets views from some of the top SWIFT for corporate representatives and outlines how SWIFT aims to sign up more corporate customers and further develop its solutions for existing customers. These objectives are part of SWIFT’s overall SWIFT 2020 Strategy. Check out the SWIFT 2020 Strategy SlideShare for further details. I think this is interesting because many corporates are looking to implement a single global bank connectivity solution – and SWIFT is an obvious contender, but SWIFT is not a magic bullet.
Read the SWIFT article for full details. Following is my summary:
SWIFT 2020 Strategy:
Alain Raes, SWIFT Chief Executive for EMEA and Asia Pacific highlights:
- SWIFT is not just for large corporates – smaller corporates, i.e. those with an annual turnover of less than US$1 billion and less than US$0.5 billion are increasing – accounting for around half of the corporates that have joined since 2014
- Existing solutions will be enhanced with further:
- Messaging solutions across payments, treasury, trade finance, securities and regulatory reporting
- Development of BPO (Bank Payment Obligation) /TSU (Trade Services Utility), 3SKEY, SWIFTRef, MyStandards, Financial Crime Compliance Services
- SWIFT aims to expand outside of their traditional hubs of North American and Europe by encouraging corporate growth in the APAC (Asia Pacific) region
- This will be supported by improving bank readiness and 7 dedicated corporate sales teams dotted around the APAC region
- Promotion of Alliance Lite 2 – SWIFT’s own cloud based connectivity solution
Andre Casterman from SWIFT corporate and trade markets group emphasises the need to digitise trade finance to enable greater process efficiencies. The digitisation according to Andre will enable big data analysis, banks to become more agile and regulatory compliance.
Marcus Treacher is Chair of the Corporate Advisory Group – these guys guide SWIFT’s corporate strategy & governance – and SWIFT Board member. Marcus explains how the Corporate Advisory Group keep their fingers on the pulse by running corporate-bank workshops where they seek to understand corporate pain points. They relays these themes back to the SWIFT board. Hmmm, interesting.
Marcus reiterates the earlier point about wanting to attract smaller corporates and the use of Alliance Lite 2 as a way of getting them on board.
The Devil Is In the Detail
This all sounds great, and it is still early days for SWIFT and their 2020 strategy.
The SWIFT 2020 strategy buzz-line is to “become the preferred secure network for multi-banked corporates globally”. That will be music to many corporates around the world, for security is a HUGE concern for companies large and small. But actually in the published article there was very little about security and the types of initiatives and measures that SWIFT will be offering in that regard.
For anyone in the payments space initiatives such as the development of 3SKEY, SWIFTRef, MyStandards sound great. But documentation, cost and cross-bank readiness are likely to hinder mass adoption.
SWIFT are actively partnering with different vendors to deliver various solutions. As the range of products increases and the partners they work with diverisfy, SWIFT need to be careful that they don’t undermine their own core competencies. For example, a data breach at one of their partners could significantly reduce confidence in SWIFT overall.
SWIFT still have some way to go with corporate on-boarding and ensuring consistency and standardisation at the banks. Arguably these are far from complete just in a single region. As SWIFT look to expand beyond their core business they will need to exercise caution, ensuring their product expansion does not cloud and dilute their core strengths. Add to this mix the fast changing global environment through the use of technology in the way we work, rest and play, the rise and rise of technology companies looking to exploit niche markets – and you have an exciting challenge for 2020!
Let me know what you think below…