Nordea pushes the ‘envelope’ with uptake of SWIFT MT 798
Nordea, amongst the ten largest universal banks in Europe in terms of total market capitalisation, has taken steps to fully automate its messaging system to help its importing and exporting customers streamline their trade messaging. By utilising SWIFT’s Message Type 798 (MT 798), Nordea’s clients can now use a single channel for exchanging standardised corporate-to-bank trade data.
A Risk management remains a prevailing concern for treasurers and finance managers from corporates that are importing or exporting goods. And for companies using multiple banks, communicating with those banks for trade finance can be a slow and inefficient process. Nordea now takes advantage of connecting their clients with multiple banking partners through a single channel. Sometimes referred to as the ‘Trade Envelope’, MT 798 is currently being used by Nordea to support capabilities of messaging export letters of credit as well as in- and outbound bank guarantees. These trade documents can be processed automatically, thereby improving efficiency, lowering costs and reducing operational risk both for banks and corporates.
Digitalisation of trade and trade finance has proven to be complicated due to the number of participants involved in a trade finance transaction. However, by our close cooperation with a number of forward-thinking corporate customers, we have developed our capabilities together. This is how far we can reach for now in terms of taking a leap towards higher operative efficiency, as we await and prepare for future developments in areas such as distributed ledgers and big data technologies.
– Urban Ljungblom, Head of Trade Finance Industry and Public Affairs at Nordea.
Launched by SWIFT in 2011, MT 798 is an authenticated message used to exchange trade data between corporates and member banks of the SWIFT system. By allowing corporates to connect with multiple banking partners through a single channel, integration and communication are streamlined, facilitating standardisation of processes and a reduction in operational risk. The MT 798 ‘envelope’ can transmit and receive either import and export letters of credit, demand guarantees, and standby letters of credit. Essentially, all actions and information related to a transaction can be included and exchanged with the relevant banking partner by either an issuing or receiving corporate.
“We are pleased to see that utilisation of the SWIFT envelope MT 798 has taken off in the Nordics,” adds Erica Åhman, Head of SWIFT in the Nordics. “This single channel and communication standard improves straight-through processing and is enabling a centralised view of trade transactions worldwide, both for business management and the increasingly important compliance purposes.”