Table of contents
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Supports compliance with regulations covering originator and beneficiary data
In the fight against terrorist financing, money laundering and financial crime, regulators are demanding greater transparency of payments data. FATF requirements have been widely adopted in regulation including the US “Travel Rule”. More recently, FATF Recommendation 16 stipulations to check that both originator and beneficiary data is included in payments messages have been adopted in EU FTR 2015 in the EU, and MAS 226 in Singapore.
Payments Data Quality checks for the presence of originator and beneficiary data in the MT 103, MT202COV and MT205 payments messages your institution sends and receives and evaluates the quality of the data using validation rules based on FATF 16. This means it checks that data is present and properly formatted – Payments Data Quality does not check the accuracy of data or reveal data content.
Originator and beneficiary data is not extracted or stored, so there are no data privacy issues with this service.
A group-wide view for more effective transaction screening and AML monitoring
Payments Data Quality provides a group-wide view of your payments traffic, so it is easy to see where data quality issues occur repeatedly – whether in a branch or originating with a counterparty – so you can take action to improve performance. For example, for incoming payments, you can provide information to correspondents on the percentage of payments triggering issues in your systems last month.
If individual transactions require further investigation in your own systems, a unique identification number makes this possible.
The Payments Data Quality audit trail allows you to track progress in resolving issues over time and incrementally improve the effectiveness of your monitoring.
Increasingly, regulators expect banks to report counterparties that systematically provide inadequate or inaccurate information about originators and beneficiaries. Payment Data Quality’s independent reports can help you to meet this obligation.
Also helps to improve operational efficiency and straight-through processing
The Payments Data Quality service can also help you to dramatically improve straight-through processing of payments messages by identifying areas where transactions are blocked or delayed due to poor formatting.
A global standard for data quality?
Ensuring payments messages include correctly formatted originator and beneficiary details is fast becoming a global regulatory requirement. Payments Data Quality is a hosted solution for monitoring institution-wide data quality. It’s a community-based financial crime compliance service from Swift.
Financial Action Task Force Recommendation 16 (2012) stipulates that banks must monitor the quality of originator and beneficiary data in the transactions they receive and take steps to resolve recurrent issues.
FATF Recommendation 16 has since been implemented in the EU Funds Transfer Regulation 2015, which is part of the EU Fourth Anti-Money Laundering Directive, and in Singapore via 2015 MAS Notice 626. Similar regulation is expected to follow in other jurisdictions. Meanwhile, the US Bank Secrecy Act (BSA) rule [31 CFR 103.33(g)], commonly known as the ‘Travel Rule’, already requires financial institutions to pass on certain types of originator and beneficiary data – such as names, addresses and account numbers – if they receive that data from the sender.
With the data Swift has, they are the only ones who could set up a tool of this quality. I don’t see how any other vendor could match the data and the way it is presented in this tool – that’s really unique.
A community-based solution
These requirements can pose challenges, particularly to smaller banks which may not have global systems providing a single view of all transactions with their own entities and correspondents.
We have developed Payments Data Quality to help address these challenges. It is part of our growing portfolio of centrally-hosted financial crime compliance services which mutualise costs for the industry and eliminate the need for system installation or integration on-site.
Payments Data Quality is a very cost-effective way to monitor and improve the quality of data in your incoming and outgoing transactions.
Read our latest case study:
Read about our community-based approach to financial crime compliance
When it comes to combating financial crime, financial institutions are increasingly in the frontline of defence. Regulators the world over require FIs to meet stringent Know Your Customer (KYC), anti-money laundering and sanctions rules and regulations. Compliance is a challenge shared by all financial institutions, and one that is best met together. Since investments in financial crime compliance do not yield competitive advantages, it makes sense to collaborate to mitigate costs and risks for everyone.
Case study: BNP Paribas
Case study: Rabobank
Case study: Payments Data Quality
ACAMS Today: De-risking and financial inclusion
Info paper: Navigating FATF Recommendation 16
Testimonials and case studies
Payments Data Quality service: BNP Paribas sets the pace
Reinforcing the payment chain to promote transparency
Rabobank - Compliance Analytics and Payments Data Quality case study
Harnessing data analytics to drive compliance and operational excellence