SWIFT: Myths and Reality

Kemal Batu

v07

Q&A

Myths versus Reality

Commons Business Objectives

Industry Needs

In Closing

Industry Needs

Increased Security

Faster & Simpler payments

Immediate /Real time reporting

Reference Data for

Payments

Bank agnostic solutions

Automation/ STP

Technology driven solutions

Risk mitigation/ Tighter controls

Common Business Objectives

4

• Centralize information by building a single point bank

communication hub to provide:

– Gain global visibility of cash and messaging flows

– Achieve straight-through-processing of payments

– Mitigate risk / Enhance resiliency

– Maintain compliance / Strengthen controls

– Deliver operational efficiencies

– Rationalize systems

Flexible Bank

Connectivity

The global provider of secure financial messaging services

SWIFT in figures

6+billion FIN messages per year (2014)

12,500+ SWIFT users

212+ Countries and territories

23.32 million FIN messages April 21st 2015

10.52% 2015 Growth trend

Common Challenges

7

Treasury

Finance

Trade

ERP

• Multitude of systems to connect, maintain, control

• Lack of global visibility across systems

• Lack of scalability / standardization

Bank Connectivity

TMS Core Processes

- Cash management

- Debt management

- Treasury accounting

- Cash forecasting

- Risk management

- In-House banking

Treasury Objectives & Scope

Bank Connectivity (ERP)

- Efficient payment process

- Efficient collections process

- Automated bank reconciliation

- Global cash visibility

- Internal control & SOX compliant

Standardized treasury processes

Expanded implementation of your TMS/ERP or Back Office Systems

Standardized, scalable bank connectivity infrastructure

Straight through processing (STP) of treasury transactions

Benefits

9

Treasury

ERP1

Corporate

Finance

Trade

Centralize and automate

Visibility and Control

Bank/Vendor Independence

Accelerate Decisions

Improve Compliance

Secure Bank

Connectivity

Myths vs Reality

Myths Reality

The costs are high SWIFT offers flexible and cost effective solutions – including cloud and on premise

SWIFT is only used for international SWIFT is utilized for domestic and international bank connectivity and transaction flows

SWIFT’s cloud based solutions have limited adoption

SWIFT Cloud solutions have the most clients connected globally of any offering in the industry SWIFT has extended its AL2 cloud offering to business applications; 9 providers have connected thus far.

SWIFT doesn’t offer integration capabilities SWIFT supports integration and format transformation/conversion across connectivity options

Only supports SWIFT standards Carries SWIFT and non-SWIFT standards (e.g. BAI2, ACH, etc) securely

SWIFT doesn't support multiple time zones SWIFT has support centers across the globe with support packages that align with a client’s service requirements

10

Corporate Adoption - Executive summary – Q3’2014 New Corporate groups: 55 (+8% 2013 Q3 vs 2014 Q3)

21%

10% 69%

Americas

Asia Pacific

EMEA

Traffic: FIN + 23% FileAct + 46% (2013 vs. 2014)

Bank adoption

1,720 banks (BIC8) offering SCORE corporate connectivity 53 banking groups certified

652 banks (BIC8) 120 countries

Corporate adoption (BIC8)

3SKey: 38 banking groups

BPO live: 15 banking groups

43%

FORTUNE Global 500

On SWIFT

Benefits at a Glance

Cost Savings

Systems Retired Enabling Quicker SWIFT Adoption

Automation increases productivity

30% per Resource

67%

Cash Visibility Improvement

Average improvement

when using SWIFT

12

$14mil net benefit

ROI of 326% over 5 years, payback in 24 months

15

25

40

Lite2

Others

40% of corporates connected in 2013 via Cloud/Lite2

SWIFT Reference Data

13

• SWIFTref delivers a single source for all of the bank reference data you need

• Automate the data entry, validation, and maintenance processes across all payments

• Drastically reduce research time and costs associated with payment rejections

Comprehensive Bank Data Automate data validation & maintenance processes

Integrate with ERP master table

Corporate SWIFT Hub

Swiftref file

ERP1

Data Gathering

ABA#

SWIFT BIC

Bank / Branch Addresses

Global Banking Authorities

National IDs

Local ACHs

IBAN / SEPA

T2 ISO No SWIFT connectivity required.

SWIFT for Corporates

Accurate Reference

Data

SWIFT and Standards

14

• SWIFT Participates actively in the definition of financial messaging standards

• All messages ISO 20022 enabled

• SWIFT Released MyStandards as an industry utility to enable better communication of standards implementation

Corporate SWIFT Hub

Swiftref file

ERP1

Standards

MT and ISO 20022

SWIFT Integration Platforms

15

• SWIFT Integration Platforms allow automation of communication with all back-office systems

• Data parsing, validation, and format transformation at the SWIFT layer

• Allows all back-office systems to leverage same capabilities

• Insulate back-office systems from changes to banks / formats

Treasury

Finance

Trade

ERP

SWIFT Connectivity &

Integration

Effective Integration

In Closing… Summary of Benefits to Corporations

Secure connectivity

with your banks

Payments Platform

Cash Management visualization

Accurate Reference

Data Standards

Effective Integration

v07

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