Financial messaging software and connectivity platforms: challenges and driving forces
05 / 10 / 2020
Every day, financial institutions and businesses depend on the secure, reliable and rapid exchange of millions of financial messages over SWIFT and other networks. However, due to a multitude of factors, operating the infrastructure needed to connect to SWIFT and to work within it is very challenging today. As a result, banks are being forced to rethink their messaging and connectivity strategy, and to re-assess all the components needed to keep infrastructure in-house, including upgrading and maintaining it. What are these challenges and, more importantly, how can they be addressed? The challenges are three-fold:
The challenges are three-fold:
1. Continuously increasing risks and costs
Running operations is becoming more costly and complex than ever. A rising level of cyber attacks, and their increased sophistication, is a reality today – not only for Tier 1 Financial Institutions but also for smaller banks. New defense mechanisms must be put in place to protect businesses and customers from fraudsters. In addition, the recent storm of regulatory requirements in the payments sector requires dedicated systems-upgrade projects in order to remain compliant. The natural evolution of the payments industry is bringing along both new technical and functional requirements. Think of Instant Payments or the integration of APIs. This also means additional investments and maintenance costs for banks.
2. Old legacy platforms don’t cater for the complexity of the modern payments business
The ever-changing payments landscape, driven by the technological revolution and its regulations, makes it difficult for existing legacy systems to follow the pace of change and to be deployed at speed. The patching approach is no longer workable, it is too costly and implementation-heavy, and only covers the current scope of changes – it does not equip institutions for the future. Think about the paradigm shift caused solely by the global ISO 20022 migration, and the implications for banks’ infrastructure. Or the SWIFT Customer Security Programme (CSP), making it compulsory for each institution connected to the SWIFT Network to comply with all mandatory controls and submit an annual compliance self-attestation. Not to mention the rise of Instant Payments and the wide use and integration of APIs – all requiring not only specific expertise and capabilities in-house but also major transformations of the legacy platforms.
3. Commoditisation of the payments business and profit squeeze
Although payments are vital, and crucial to the banking business, they’re still a commodity for end customers. Payments must be seamless: fast, transparent, cheap and with global reach. To go alongside their search for constant investment, banks look for new efficiency gains through both automation and the mutualisation of collective solutions. Banks are seeking to reduce manual interventions, not only for the sake of efficiency but also because manual interventions are prone to fraud and error. Finally, the banks also need to put forward competitive offers in order to re-establish themselves in a market crowded with new entrants. All this has forced traditional banks to reassess existing operational models and rethink existing infrastructures.
Building a platform
At equensWorldline we address those challenges in our new generation messaging and connectivity platform. It’s built around scalability, operational excellence, agility and interoperability, but also provides the flexibility of workflow orchestration and integration options. equensWorldline offers a highly available, secure and scalable platform for financial messaging. Worldline SWIFT Service Bureau solution can be used by financial institutions of all types and sizes.
We sincerely believe that by outsourcing their legacy platforms to a trusted partner like equensWorldline, our bank clients will reduce not only their operational costs and risks but will also bring down their costs associated with auditing, compliance and certification.
Learn more about financial messaging services via this webinar from Marianna Janssen, Business Development Executive, Worldline.
Expand your relationship with your merchants and delegate the processing to expertsLearn more
How BNP Paribas is cracking down on direct debit fraud.
Autonomous Payments - What if you never have to pay for anything? | Podcast
Worldline awarded Payment Institution Authorisation by the FCA, ensuring business growth in the post-Brexit UK payments landscapeLearn more
How an advanced developer portal contributes to increasing product sales | Blog