SWIFT connectivity SWIFT has been one of the main beneficiaries of this move to bank-agnostic systems and services, showing a 40% growth in corporate users in 2009, taking the total to 565. The majority of corporate users connect to SWIFT via a service bureau, with 20% of last year’s new users opting to use the SWIFT Alliance Lite service.
Large companies still dominate the SWIFT corporate user base, but 2009 saw a significant increase in the number of medium-sized and smaller companies. Corporate user traffic is still dominated by SWIFT FIN messages for bank account balance and transaction reporting and for payment messages, and the use of SWIFT FileAct bulk message files continues to grow as corporate treasurers exchange transactions in domestic formats with their local banks. The use of the new ISO20022 XML messages, launched on SWIFT in mid 2009, has also begun to grow worldwide.
SWIFT, the banks and service bureaus all expect this impressive growth in corporate usage of the SWIFT network to continue with an increasing share of medium-sized and small companies.
Financial ecosystem connectivity
The efficiency of the financial ecosystem is vital to any company’s overall performance. The objective of SunGard’s new AvantGard EcoSystem Communication Service, launched in September 2009, is to streamline and integrate all of a company’s internal finance and treasury processing systems with those of their banks and other financial service providers. This new communication service, described in Figure 4, is the next generation solution for companies using SunGard’s eTX.
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Figure 4 – Management of financial ecosystem connectivity |
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Source: SunGard |
SunGard has worked closely with SWIFT to deliver its new communication service, having been awarded preferred partnership status, and has also developed connectivity with other networks and payment systems. It has also developed new standards to ensure full integration of its new service with particular applications and services within clients’ banks. New partnerships providing access to FX risk exposure analysis, money market funds, digital remittance processing and collection agencies have been entered into to ensure the service covers all the main treasury functions. Ken Dummitt, president of SunGard’s AvantGard Corporations business, claims, “Our AvantGard EcoSystem Communication Service, which integrates and networks key partner and communication service technology, will help to fundamentally change how corporations do business by creating transparency and efficiencies that reduce friction across the corporate commercial ecosystem.”
Bank EB systems and portals
Internet-based EB systems have been used to provide the connectivity for companies to access information on their bank account balances and transactions, to send payment and other instructions to the bank and to deliver basic cash management services for some years. They are now being developed and transformed into full online bank portals to deliver far more advanced cash and treasury management services.
Citi has now put all its EB transaction, and cash and treasury management services, on to a single platform called CitiDirect BE (Banking Evolution). This new platform combines transaction management services with business analytics and market information, often on one screen. They aim, as Gary Greenwald, chief of information services at Citi’s Global Transaction Services, says, “To take convenience to the next level for our corporate clients managing their cash.”
Citi is piloting its new platform with a number of corporate clients, with full roll-out still to be determined. Citi also intends the platform to be used by other banks, unwilling or unable to invest the $100 million or more required, on a white-label basis.
EB services are all inevitably very similar so the banks try to differentiate their services wherever possible. In an attempt to make its EB services more user-friendly and less impersonal Citi now allows its experts to record commentaries on their specialist treasury functions at their desks in the office, rather than having formal studio-produced videos. Ian Chittick, head of eCommerce, transactional banking, at Lloyds Bank Group, believes, “Adding value in today’s ‘Generation Y’ society means recognizing virtual relationships and sharing knowledge as well as exchanging data … It’s no longer a case of technology as a blunt tool. Banks that think they can divorce relationship from technology are destined to fail.”
