SWIFT gpi: Sign up now!

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1 SWIFT gpi: Sign up now! Get most out of mandatory standards release 2018 March 2018

2 Sign up to gpi now, get most out of mandatory standards release 2018 Standards Release 2018 mandates UETR on all key payment messages Sign up to SWIFT gpi now Maximise the benefits 2

3 What is the problem gpi is addressing Martin Schlageter Head of Treasury Operations Roche Peter Claus-Landi Director banking initiatives General Electric Brooke Tilton Vice President, Treasury Operations Viacom Michel Verholen Director, Global Treasury Center Zoetis Speed Critical business requires faster payment execution Transparency Many times we don t have visibility on the fees lifted along the way Tracking I m not able to tell when the money hits the beneficiary s bank account Remittance information We miss information regarding the invoice and the payer for timely reconciliation Today s cross-border payments experience 3

4 What is SWIFT gpi SWIFTgpi Accessible by any bank gcct (gpi Customer Credit Transfer) Speed, with same day* use of funds Messaging technologies Transparency on fees End-to-end payments tracking Core transaction banks SLA rulebook Remittance information transferred unaltered gsrp (gpi Stop & Recall) Instant stop&recall of a payment Reaching any bank gcov (gpi Cover Payments) Accessible by any corporate Directory Tracker Observer End-to-end tracking of the cover funds Value-added product suite 4

5 The gpi payments Tracker Central payments database, hosted at SWIFT and directly updated and consulted by gpi member banks (via MT199 or APIs) Track path, in real time Details of banks along the chain Transparency of total fees and time Unique, end-end tracking number Mobile API API MI TMS/ERP API Ordering Customer Portal PEFIJPJT SWUBDEFF SDEBFRPP Beneficiary Customer 5

6 Over 150 global transaction banks signed up 220+ country corridors 140K+ gpi payments/day 11+ Mio gpi payments since go live 42 Nordea Bank Danske Bank Raiffeisen Bank International E.SUN Commercial Bank gpi banks live Royal Bank of Canada ING Bank Rabobank China Guangfa Bank ABN AMRO Bank China Minsheng Banking Corporation Bank of New Natixis KBC Bank Bank of Communications Citi Bank of China York Mellon Crédit Mutuel-CIC Banques Deutsche Bank China Construction Bank Wells Fargo Société Générale ICBC JPMorgan Chase Bank UniCredit CTBC Bank Sumitomo Mitsui BBVA Intesa Sanpaolo Siam Commercial Bank Banking Corporation Bank of America Merrill Lynch Mashreq BNP Paribas OCBC Bank Bank DBS Bank Alfa-Bank Standard Chartered Bank ABSA Bank National Australia Bank Nedbank Standard Bank of ANZ South Africa Commonwealth Bank of Australia 150+ Banks 200+ Countries 78% SWIFT cross-border payments Agricultural Bank of China Akbank Al Baraka Bank Asociación Popular de Ahorros y Prestamos Associated Foreign Exchange Axis Bank Banco Bisa Banco de Chile Banco de Crédito del Perú Banco de Galicia y Buenos Aires Banco de Reservas de la República Dominicana Banco del Pacifico Banco Económico Banco Inbursa Banco Sabadell Bangkok Bank Bank al Etihad Bank for Investment & Development of Vietnam Bank Negara Indonesia Bank of Georgia Bank of Hangzhou Bank of Jiangsu Bank of Montreal Bank of Nanjing Bank of Ningbo Bank of Shanghai Bank of Tokyo-Mitsubishi Bank of Zhengzhou Bank Pekao Bank Rakyat Indonesia Bank Sinarmas Bank Uralsib Banque Centrale Populaire Barclays Bayern LB Bidvest Bank Budapest Bank CaixaBank Cajamar Caja Rural Cambridge Mercantile Corp. Canadian Imperial Bank of Commerce Central Africa Building Society China Citic Bank China Merchants Bank China Zheshang Bank Chong Hing Bank Commercial Bank of Kuwait Commerzbank CRDB Bank Crédit Agricole Credit Suisse Dah Sing Bank Denizbank Diamond Trust Bank DNB Bank Ebury Ecobank Emirates NBD Erste Group Bank FirstRand Bank GCB Bank HSBC ibanfirst ICICI Bank Industrial Bank INTL FCStone Ipagoo Kapital Bank Kasikorn Bank KCB Bank KEB Hana Bank Kookmin Bank Landesbank Hessen-Thüringen Lek Securities Corporation Lloyds Bank Mizuho Bank National Bank of Kuwait National Commercial Bank National Microfinance Bank NIC Bank Ping An Bank Piraeus Bank PKO Bank Polski Postal Savings Bank of China Promsvyazbank PJSC Riyad Bank Santander Sberbank Scotiabank SEB Shanghai Pudong Development Bank Shanghai Rural Commercial Bank Shengjing Bank Shinhan Bank Skye Bank Tadhamon International Islamic bank TEB Toronto-Dominion Bank Turkiye Cumhuriyeti Ziraat Bankasi Turkiye Garanti Bankasi Turkiye Is Bankasi UBS Group United Overseas Bank Vietcombank VietinBank Westpac Banking Corporation Woori Bank Yapi Kredi Bankasi Yinzhou Bank Zhejiang Rural Credit Cooperative Union 6

7 Since launch in January 2017, gpi has seen rapid adoption Very large 150+ community banks committed to implement, 48 top 50 banks signed 200+ countries covered 78+% SWIFT cross-border payments represented Millions live payments 42 banks live 29 top 50 banks 11+ Mio gpi payments since go live 150K payments/day 220+ country corridors 17% cross-border MT103 sent as gpi Delivering real value Nearly 50% credited to beneficiary < 30 minutes, many within seconds More than 100 billion USD in gpi payments made per day Significant drop in bank enquiry costs ( %) Positive reactions from corporates 7

8 Why join today? SR 2016 gpi UETR SWIFTgpi Tracker MT 103 gpi messages to gpi banks only ~ 50K paym/day gpi tracking if processed by gpi bank 100 banks gpi bank gpi bank non gpi bank SR 2017 UETR SWIFTgpi Tracker gpi gpi MT 103 UETR gpi messages to all your counterparties ~500K paym/day gpi tracking until first non-gpi bank 4,000 banks gpi bank gpi bank non gpi bank non gpi bank SR 2018 non gpi bank MT 103 UETR UETR UETR UETR gpi bank gpi bank SWIFTgpi Tracker gpi gpi MT 103 non gpi bank non gpi bank SWIFT makes gpi tracking new norm for banks gpi messages with all your counterparties ~ 5M paym/day gpi tracking end to end 10,000 banks 8

9 SR 2018 mandates all SWIFT users to add and pass on UETR on ALL key payments, Non-gpi / gpi bank Non-gpi / gpi bank Non-gpi / gpi bank MT 103, UETR #123 MT 103, UETR #123 All SWIFT Users, including non-gpi members, must add and pass on a UETR (Unique End to End Transaction Reference) in all MT103, MT 103 STP, MT 103 REMIT, MT 202/205 and MT 202/205 COV messages All SWIFT Users must be able to receive the gpi fields 111 (Service Type Identifier) and 121 (UETR) in block 3 of any Category 1 and Category 2 FIN message Non-compliance will generate a NAK 9

10 SR 2018 impact on back-office applications SR 2018 Any SWIFT User Any SWIFT User Any SWIFT User Ordering Institution Intermediary Institution Beneficiary Institution 1 Generate new UETR 3 Copy same UETR MT 103 (1), UETR #123 MT 202 COV, UETR #123 2 Relay same UETR MT 103 (1), UETR #123 Example of a valid UETR #123: 77e8367b-d3e7-4dfc f041c4058d3 Back office application Back office application Back office application (1) Mandatory UETR applies to MT103, MT 103 STP, MT 103 REMIT, MT 202/205 and MT 202/205 COV 10

11 Temporary solution if back-office application cannot be ready in time for SR 2018 Any SWIFT User Back-office FIN Application MT 103 (1), NO UETR Interface MT 103 (1), UETR #123 If back-office does not provide UETR (field 121), FIN interface must generate and add a random UETR (2) Message will not be NAKed because of absence of mandatory UETR field Scenario SR 2018 Change Back-office implementation FIN Interface (Temporary Solution) Payment Initiation Generate new UETR (*) Intermediary traffic Relay same UETR (**) Cover Initiation Copy same UETR (MT 103) (**) (*) If customer not ready to implement UETR generation in back-office in time for SR 2018, FIN interface can provide a temporary solution. (**) FIN Interfaces not mandated to copy or pass on UETR from incoming message into outgoing message, correct standards usage requires change in back office. (1) Mandatory UETR applies to MT103, MT 103 STP, MT 103 REMIT, MT 202/205 and MT 202/205 COV (2) Mandatory SR 2018 requirements for FIN messaging interface providers 11

12 In a nutshell.. Non gpi / gpi bank UETR Non gpi / gpi bank UETR MI UETR Non gpi / gpi bank UETR Non gpi / gpi bank UETR Non gpi / gpi bank MI UETR Non gpi / gpi bank UETR becomes the norm for all SWIFT members End-to-end tracking will be available to gpi members 12

13 Conclusion: You have 2 options Comply with SR 2018 Add and pass on UETR Update payment systems Watch transformation of your peers Incur costs Limited benefits Sign up to gpi Capture value from SR 2018 investments Access gpi tracker with end-to-end tracking Immediately stop a payment Improve cover payments management Maximize business with key counterparties Build innovative services on top of gpi Leverage easier implementation options Limited incremental costs Significant benefits 13 13

14 For larger, intermediary bank Cost/Effort Benefit gpi SR 2018 gcct, incl. confirmations, fees, unaltered remittance Support gsrp Support gcov Generate UETR Pass on UETR UETR on COV gpi SR 2018 Remain competitive Access tracker with extended tracking Better service clients Reduce investigations costs Immediately stop a payment Improve cover payments management Get more value with product roadmap UETR eg: s 14

15 For smaller bank Cost/Effort Benefit gpi SR 2018 gcct, incl. confirms, fees, unaltered remittance Support gsrp Generate UETR Pass on UETR gpi SR 2018 Retain business from counterparties Reduce payment inquiries Visibility on liquidity/incoming payments Access to tracker with extended tracking Better service your clients Immediately stop a payment Get more value with product roadmap UETR eg: s 15

16 SR2018 SWIFTSmart modules Trainings content: 3 modules cover all SR2018 changes Part 1 (Category 1, 2, 9) Part 2 (Category 3, 5, 6) Part 3 (Category 7) Detailed explanation for impacted field Scenario-based message flows to assist understanding Target audience: Everyone involved in SR 2018 implementation such as business analysts, architects, process managers, operators, IT staff, and application vendors. Link to SR2018 modules 16

17 Reduced efforts if you use a gpi-ready vendor application Cost/Effort Today 8 application vendors have a gpi-ready application: gpi SR 2018 ACI worldwide China systems CGI(Bess+) Finastra (ex-d+h) ECS Fin FIS (ex-c2p) Montran Oracle 17

18 SWIFT will help you become gpi Make business case Project initiation Implementation Go to market SWIFTgpi 18

19 Sign up to gpi now, get most out of mandatory standards release 2018 Standards Release 2018 gpi Maximum Benefits 19

20 More info 1 Learn more on or on our SWIFTgpi ipad app 2 Contact your regional expert: Americas, UK and Nordics: David.Lefferts@swift.com EMEA Astrid.Coppens@swift.com APAC Qinwen.Xiao@swift.com 20

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22 SR2018 Impact on back-office applications Back-office Application General Ledger 5 7 Archiving Payment Application1 Routing & Channel Management 3 4 Other Connectivity solution 6 Market infrastructure Other systems Investigation Helpdesk Payment Application2 FIN Messaging Interface SR FIN Block3 typically processed in channel routing engine. Generated UETR must be passed to Payment Application Intermediary agents must copy UETR from inbound to outbound message, cover initiators must copy same UETR of underlying MT103. Payment Application1 will be changed for SR 2018 need to store UETR with payment transaction details. Investigation tool and Helpdesk need to retrieve transactions based on Transaction Reference *and* UETR. Payment Application2 will not be changed for SR 2018 configure FIN Interface to add UETR & inform back the routing engine. Archiving solution needs to store UETR with transaction details and retrieve archived transactions based on UETR. FIN Interface must be updated with SR 2018 update delivered by vendor and test of SR 2018 traffic conducted. Evaluate impact on other systems. Does the Market Infrastructure support gpi and UETR? 22 8

23 Back-office activities and effort to comply to SR 2018 and incremental effort to become gpi gpi Required by SR2018 (est. 1-2 months effort) Incremental effort to be gpi (average 3-6 months) Instructing bank Intermediary Instructed bank gcct End-to-end tracking Generate UETR* Receive & Relay UETR Receive UETR Confirm credit status update Pending/Rejected status update Pending/Rejected status update Transparency of fees Fees populated in case of SHA or BEN Remittance information MT 103 field 70 unaltered gcov End-to-end tracking Copy UETR from MT 103 Receive & Relay UETR Receive UETR Confirm credit status update Pending/Rejected status update Pending/Rejected status update Transparency of fees No deduction from principal amounts of gpi cover payment gsrp Stop & Recall Receive & Respond SRP request Receive & Respond SRP request * FIN interface spec will force the generation of the UETR on all FIN interface providers, if not present 23