ISO20022 - Transition to a uniform payment format

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The time has come in November 2022. The Eurosystem is switching to ISO20022 XML messages and EBA Clearing and SWIFT will also switch to the ISO20022 standard in the next few years. The old MT formats for payment transactions will be converted to XML.

Why should a bank or a company rely on ISO20022? It is now becoming increasingly clear: ISO20022 will be the global standard by 2025.

A major advantage of switching from the MT to the MX standard is the richer and more structured data that is available in messages according to ISO20022. This can be used for a variety of purposes. The expansion and implementation of new data fields enables the structured further processing of useful data and information by banking systems. Compliance processes such as AML/KYC, embargo checking and sanction screening benefit from this in particular. Banks and financial institutions in particular could also use this data to improve the user experience, as the bank's customers benefit enormously from improved reporting, billing, invoicing and reconciliation processes.

This change will bring with it many opportunities, particularly for smaller ecuador consumer email list banks and companies in which many processes, especially financial structures, have been firmly established for a long time. But like any major change, it can initially present an extraordinary challenge.

With the migration from ISO, the following is established:

a global standard across all payment formats
compatibility across all systems
a clear, predefined and standardized format (XML)
The conditions for establishing the ISO20022 standard are a conversion of the legacy systems and legacy data, as well as data validation. Archive data and data generated during parallel operation must be stored in a uniform manner and, in addition, different legacy formats must be transformed once and continuously. Validity must be ensured.

The change affects banking areas such as all channels between customers and banks (mobile, EBICS, SWIFTNet, etc.), the payment system (embargo, fraud, compliance, etc.), clearing engine (SEPA, InstantPayment, SWIFT, etc.) as well as settlement mechanisms (DB Services, EBA Clearing, SWIFT, USFedNow, etc.) and reconciliation mechanisms. In conclusion, the change to a uniform payment format requires fundamental changes in the process in the medium and long term.