SWIFTNet Trade Services Utility enters pilot phase

Published on 29 March 2006

Workshops and training sessions ensure banks in Europe, the US and Asia/Pacific are well prepared

Takeo Sato, General Manager, Bank of Tokyo-Mitsubishi UFJ presenting the bank’s drivers for TSU adoption and new TSU-based services
February marked the beginning of the SWIFTNet Trade Services Utility (TSU) pilot phase. From December 2005 onwards the SWIFT team and the 18 pilot banks were busy putting the final pieces in place. Workshops and training sessions provided information and training for the pilot banks while generating valuable feedback for the SWIFT team and essential interaction all round.”

Several working groups met in Europe

December spurred six consecutive days of intense workshop activity in London and Brussels. A total of 48 delegates representing the pilot banks attended. Additionally, there were representatives from software partners and consultancies that will work with the pilot banks through their implementation projects.
TSU principles:
— the TSU does not make business decisions
— bank-to-corporate and corporate-to-corporate obligations are outside the scope of the TSU
— the TSU works with data elements/sets, not with trade documents
— a TSU data set does not represent a corporate contract per se, nor does it establish one, and any service offerings provided by a bank to its corporate clients are totally independent from the TSU itself.

These principles have enabled SWIFT to differentiate between the collaborative space in which it operates and the competitive space in which the banks operate.
First to meet, in London, was the TSU Rules Working Group. This group advises SWIFT on the regulatory environment in which the TSU will operate. It is helping SWIFT to define the TSU rules framework, ensuring that TSU-bank based services requiring inter-bank co-operation can operate smoothly. The Roles and Responsibilities section of the TSU Service Description will be the first output. The TSU Service Description is on schedule for delivery in May.

The TSU Business Working Group followed. This group has a two-fold objective: (1) to achieve a common understanding of the potential business benefits to be derived from the TSU and (2) to assist in the development of the value proposition that will be used to support market positioning. The business opportunity for the banks revolves around intermediation into open account. Data matching at trigger points across the supply chain increases users’ confidence. Data visibility facilitates improved management of risk and financing. It also creates opportunities for banks to offer value–added information services, for example to help corporate treasurers optimise liquidity, and it supports process insourcing.

Two days in Brussels concentrated on training for pilot banks. This attracted a large audience of product managers, IT analysts, software vendors and consultants. Presentations covered the TSU concepts, message standards and application logic. The group also received a demonstration of the TSU accessed via the TSU-Interface. Feedback indicated that some vendors are already well advanced in their integration of TSU functionality into their supply chain applications.

Actions in the US and Asia

Some banks are piloting the TSU from more than one geographic location and therefore similar training sessions took place in New York (January) and Hong Kong (March). A number of the pilot banks were represented at all three locations.

The training session in New York was attended by over 20 bank representatives, whilst more than 30 attended the training session in Hong Kong. Here, Mr Takeo Sato, General Manager, Bank of Tokyo-Mitsubishi UFJ presented his bank’s drivers and approach to TSU adoption, together with an impressive list of new and improved TSU-based services. Commented André Casterman, Senior Product Manager, SWIFTNet Trade Services Utility, SWIFT, “Banks are keen to learn about the TSU functionality but their real challenge is to develop those new and improved supply chain services and create new service offerings. We appreciate sharing of such valuable information by the Bank of Tokyo Mitsubishi UFJ".

The pilot kicks off

As the preparatory sessions wound up, the 18 banks moved confidently into the pilot phase. Over the next few months they will share their experience with the SWIFT community as they prepare to go live.
Watch this space!

SWIFTNet Trade Services Utility pilot banks: ABN AMRO, Banca Intesa, Banco do Brasil, Bank of Tokyo-Mitsubishi UFJ, BNP Paribas, Calyon, Citibank, Deutsche Bank, First Rand Bank, HSBC, JPMorganChase, KBC, Mizuho, RBS, Société Générale, Standard Bank of South Africa, Standard Chartered Bank, The Bank of New York