Lanka Financial Services Bureau Ltd (LFSBL) launched one of the first conferences/training sessions for the ISO20022 message standards of the payments and settlements system worldwide on May 29, 2023 in Colombo.
LFSBL is the only Certified SWIFT Shared Infrastructures Provider in Sri Lanka and is owned by 22 shareholders in banking and the financial industry, which include the Central Bank of Sri Lanka, key state banks, leading commercial banks, primary dealers and the Central Depository System of Sri Lanka. The first session is dedicated to the team from the Royal Monetary Authority of Bhutan.
This is a significant initiative in the process of change management from the current standards of financial messaging to the ISO 20022 standards, which technically transform messages to XML format. messaging standard is a Global initiative by SWIFT (Society for Worldwide Interbank Telecommunications)as a mandatory change in their global network.
Correspondent banking has extraordinary reach, facilitating cross-border payments, their confirmations and account statements the world over. The processes are connected to a highly reliable robust, secure network of financial institutions that instruct one another with a common, well-established language. The system has served the world well for several decades.
The next stage of transformation will come from data with better-quality in those payments processes, which will further improve the efficiency, speed and compliance of payments, enabling better customer experience and opportunities for extending services to new customers and businesses.
SWIFT ISO20022 drives the progress towards better quality of data in payments is paramount as it will bring significant benefits in enhanced automation, faster processing, more effective reconciliations, improved levels inmitigation of financial crime risk, and better data-driven insights on the purpose and context for payments. Better data is also a platform for innovation, enabling banks and third parties to offer new, value-added services for customers. Improvements in data need to happen consistently and end-to-end across client payment initiation, domestic payment systems, financial institutions and their payments providers.
In order to realise these significant benefits to the banking and financial industry, a modern data standard is required that is data rich, ensures consistent interpretation and is accepted across the industries and world. ISO 20022 is that standard. It is an open international data standard being adopted around the world for domestic payments systems and will be adopted by the SWIFT community for cross-border payments and reporting.
The need for better quality data in payments is urgent and brings a number of significant benefits.