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Taking the guesswork out of managing expected funds

Taking the guesswork out of managing expected funds

Technology and Innovation,
6 April 2021 | 5 min read

J.P. Morgan innovates to offer SWIFT’s inbound payments tracking service via APIs

Corporate treasurers can sometimes lack visibility and certainty over the status and timing of inbound payments. This presents them with a significant challenge when it comes to making timely and informed cash management decisions.

However, by using the SWIFT gpi for Corporates’ inbound payments tracking service, banks can now offer corporate customers visibility over their incoming cross-border payments, opening up a wealth of new opportunities, such as the ability to forecast liquidity.

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The Choice: Messaging vs Portals vs APIs

When it comes to how to implement inbound payments tracking, banks have a choice to make which can have a significant impact on the level of service they can offer customers. They can, for example, offer tracking updates via traditional payment messages (known as MT199s). Alternatively, they can integrate these updates into an online banking portal for customers to view on demand.

Messaging and online portals are established channels – and definitely get the job done – but the client experience can be enhanced further by using APIs. APIs enable the real-time exchange of information between the SWIFT gpi payments tracking database, the banks applications, and the corporate, making complex processes happen in nanoseconds.

The flexibility this can offer end-customers is remarkable. Clients can automate API calls to happen every few hours, minutes, or even seconds. As such, the bank, client and SWIFT’s applications are fully in sync and working in perfect harmony – and the client always has a view over their inbound payments.

J.P. Morgan takes the strategic option

Seeing the huge benefits that the inbound payments tracking service via APIs can deliver, J.P. Morgan  has become the first bank to leverage SWIFT’s Software Development Kit (SDK) – available free on our Developer Portal – to offer this service to its customers.

By opening an API channel to SWIFT, J.P. Morgan can offer its clients real-time tracking of incoming payments – from the moment they enter the SWIFT gpi network, right through to the time they are received by J.P. Morgan and credited to their account.

One of our goals is to help our clients realise their objectives of a fully optimised treasury through real-time data delivery and enhanced transparency 

Alan Lin, MD, Head of Asia Pacific Core Cash Management at J.P. Morgan.

“We have moved closer in achieving this goal by integrating the SWIFT gpi for Corporates inbound payments tracking service using APIs. Seamless integration of SWIFT gpi data can help our clients to reduce the friction in current cash management processes and help them to focus on their core business.”

Opening up a world of possibilities

By implementing the inbound payment tracking API, J.P. Morgan has opened the path for more efficient data exchanges via APIs – not just for inbound tracking, but for the full suite of gpi data and beyond.

To enable simpler implementation based on a common standard, J.P. Morgan’s APIs closely mirror SWIFT’s recommended API specifications. This also allows for leveraging SWIFT’s planned API channel for exchanges of data between SWIFT users in the future.

The use of APIs delivers a whole host of benefits for the bank:

  • Ease of integration – API connectivity allows for the integration of inbound payment statuses directly into corporates’ ERP (Enterprise Resource Planning) or TMS (Treasury Management System) applications with relative ease.
  • Accessible real time data – While J.P. Morgan pushes updates to corporates, client users can initiate queries for real-time information whenever required. 
  • Future proof build – usage of APIs will support the use of ISO 20022 data structure.

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Delivering the benefits directly to corporates

The new service provides corporate treasurers visibility over their inbound payments with full status transparency as well as deductions and FX rates where relevant, improving the efficiency and cost of management of these transactions. 

It also provides the ability to develop forecasting and trending models – data received from the notifications will allow clients to potentially forecast receipt time and cost of transactions. Furthermore, corporates will now be able to monitor and review unusual payment behaviour, and recommend optimal payment routes to their buyers. 

Corporates can also pass on the benefits of incoming payment visibility to their clients and suppliers – optimising the trade and fulfilment process and providing certainty of funds initiation.

There are a number of key flows and scenarios where availability of the service can reduce friction for corporates, including:

  • B2B trading on ecommerce platforms – Corporates can create value added products such as seller visibility on incoming funds, improving certainty of transactions and enabling timely fulfilment of the order and optimisation of cash flows for sellers.
  • Trade Finance – LC-based trade finance instruments require payments to be made within a specific timeframe which must be met upon presentation of documents. Incoming payments visibility to the supplier can address the major pain point of delayed payments and reduce reputational risk for importers.
  • Delivery of goods and services on receipt of payments – Tracking information can help in reducing cycle time in scenarios where delivery of time critical goods and services is tightly linked to release of funds by the buyer. Examples include the fueling of commercial jets, payment of duties at ports and purchase of capital assets.
  • Reduction in Operational Cost – for some transactions corporates have to pre-advise their banks of incoming funds. Inbound payments tracking can reduce the need for pre-advice, reducing operational cost and risks of claims from delayed or failed payments.
  • Cash flow and payments optimisation – Incoming view of funds which are to be credited to the account will enable clients to utilise incoming funds and any available intraday credit most efficiently, helping them make payments at the most optimal time.

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