11 May 2016

How does ISO 20022 enable innovation in ASEAN/Asia Pacific?

As the ASEAN region moves towards financial integration, the adoption of common standards has never been so pressing. With a strong focus on harmonisation and automation, SWIFT is committed to support the community with regional standards integration. As the registration authority for ISO 20022, SWIFT plays an active role in various market practice groups and initiatives to promote best practices and facilitate standards integration.

In order to continue promoting community engagement in the ASEAN region, SWIFT hosted Standards Forums in Kuala Lumpur (29 February) and Manila (8 April). Together, these events gathered more than 420 participants from banks, central banks, market infrastructures, corporates and IT service providers.

Standards Forum

Opening the Forum, Sharon Toh, Head of ASEAN, SWIFT and Isabelita M Papa, SWIFT Philippines User Group Chairperson and Executive Vice President, Asia United Bank Corporation welcomed the participants in Kuala Lumpur and Manila respectively and emphasised ISO 20022 as the regional and cross border financial messaging standard of choice.

As the hosts of the forum, Gim Soon Tay, Chief Operating Officer, Malaysian Electronic Clearing Corporation and Bella S. Santos, Director, Payments and Settlements Office, Bangko Sentral ng Pilipinas provided the latest developments of standards initiatives and their strategic direction for their respective countries.  

Cindy Foo, APAC Standards, SWIFT, set the scene by giving a history of standards evolution in the securities and payments markets as well as key drivers, benefits and approaches of adopting ISO 2002 standards.

The key theme of both Standards Forums was ‘Innovation’. The panel session “How does ISO 20022 enable innovation in ASEAN/Asia Pacific?” moderated by Alexandre Kech, Head of Securities Markets and Standards in SWIFT APAC, led to interactive discussions on how people perceive ISO 20022 as an enabler for innovation. We have included below a selection of insightful quotes from the speakers.
 
Firstly, a bank’s view on ISO 20022-based real-time payment “FAST” in Singapore:

FAST is just a utility and it is up to the banks to leverage on it to innovate….OCBC makes it easy and convenient for their customers to make micro-payment without the need for recipient’s account number and transaction signing token. Instead money can be transferred to the recipient’s account almost instantaneously through mobile number, email or Facebook!

- Sharon Khua, Vice President, Group Operations & Technology, OCBC Bank

Next, from a corporate’s point of view:

XML-based ISO 20022 allows innovation and new frontiers and this is what corporate treasurers want. Rich data, straight-through-processing, full accountability and zero reconciliation, this is what ISO 20022 is to me

- Liel Pascual, Consultant, Bankers Association of the Philippines

Standardising payment file format across different banks due to banks’ specific requirements and countries’ specific regulations is a challenge. I recommend using Common Global Implementation, global market practice to consistently and easily adopt ISO 20022.

- Mei Yee Chua, Founder and Principal Consultant, Alpha & Omega Consulting

For AML mandatory info, we do not see rich data in MT messages, but ISO 20022 can handle AML and screening because of its structured capabilities” 

- David Blair, Managing Director, Acarate Consulting

Finally, from the regional perspective in ASEAN:

Standards ensure interoperability. Everything needs to be interoperable…..For Asia regional standardisation, more and more we see regional stakeholders prefer regional standards in addition to international standards

- Tomo Yamadera, Principal Financial Sector Specialist, Sustainable Development and Climate Change Department, Asian Development Bank

Simply put, innovation is also about doing and making things better. Innovative services enabled by ISO 20022 make financial transactions easy and convenient for customers and users, as enriched data enables straight-through processing, anti-money laundering and reconciliation. As more and more markets adopt and use ISO 20022 standards regionally and globally, harmonising market practices through bodies such as Common Global Implementation (CGI) and Securities Market Practice Group (SMPG) is imperative. Alex Kech wrapped up the panel session by highlighting SWIFT’s role and standards expertise in ASEAN’s financial integration and sharing SWIFT’s recent involvement in various working groups to drive the regional harmonisation initiatives.

After lunch, a two-hour workshop on ISO 20022 standards was facilitated by Kiyono Hasaka, APAC Standards Manager, SWIFT and Magdalene Goh, Business Solutions Manager, SWIFT.

Standards Forum

For more information about Common Global Implementation (CGI) and Securities Market Practice Group (SMPG), please visit the following sites:
CGI: https://corporates.swift.com/en/common-global-implementation
SMPG: www.smpg.info

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