SWIFT limits Standards MT Release 2009 to minimise customer impact in financial crisis

Changes restricted to payments messages, streamlining standards portfolio

When the annual SWIFT standards release goes live on 21 November 2009, changes will be limited to payments messages and minor amendments to streamline the standards portfolio. The SWIFT Board of Directors decided to reduce the scope of the release in light of the global financial crisis, in order to minimise the burden of change on the SWIFT community in this difficult economic environment.

The decision to continue with planned changes to payments messages (categories 1, 2 and 9) was driven by regulatory demands related to anti-money laundering and the fight against terrorist funding - specifically the need to provide full transparency on payment originators and increase transparency with cover payments.

To address the issues with cover payments, two new variant messages will be introduced in the 2009 standards release – the MT 202 COV and the MT 205 COV. In these messages it will be mandatory to include a copy of selected fields from the underlying customer credit transfer sent by cover method. This will allow correspondents, involved in processing the transaction, to screen payments in line with regulations.

In addition, in the 2009 standards release most of the usage rules governing completion of field 50F “Ordering Customer” in payments messages will be turned into network validated rules. This means that customers will receive a negative acknowledgement if use of this field is non-compliant – enforcing the need to respect the rules, reducing manual repairs and queries and improving straight-through processing (STP).

The field was introduced in the 2007 standards release to accommodate Financial Action Task Force Special Recommendation VII that requests financial institutions to be fully transparent on payment originators in credit transfers, and makes it possible to provide information on the ordering customer in a structured way.

Some small changes will be introduced in the standards release 2009 to support SWIFT’s efforts to streamline its standards portfolio. Messages that have not been used during recent years – MTs 106, 121 and 206 – will be removed from the network in November.

Unused messages in other categories will be removed in 2010. Following the completion of the migration from Bilateral Key Exchange (BKE) to the Relationship Management Application (RMA) in 2008, BKE messages MT 960 – MT 967 have become obsolete and will also be removed from the network in the 2009 standards release.

The changes to other MT categories of SWIFT message standards (categories 3, 4, 5, 6, 7, 8 and n) are postponed to a future standards release.