Swift plans new vetting system to speed payments
The Society for Worldwide Interbank Financial Telecommunication says a pre-validation system it will launch soon to catch payment message mistakes prior to dispatch should increase the number of payments reaching beneficiaries in less than 30 seconds.
More than 50% of payments through Swift's Global Payments Innovation program already are credited to the beneficiary as a faster payment, some arriving in just a few seconds.
But through the use of secure application identifiers, predictive analysis and artificial intelligence tools, the new GPI capability will pre-validate messages by identifying and flagging potential issues ahead of time, Swift stated in a Tuesday press release.
Payment delays often occur when message data has an incorrect beneficiary listed, or a name missing, or it lacks sufficient regulatory data on the cross-border payment.
"Within the fast-growing GPI community, there is a strong demand for further transparency and the ability to address issues before payments are made, so that they are as predictable and efficient as possible," Swift CEO Gottfried Leibbrandt said in the release.
The process allows the payment originator to verify with the beneficiary bank, ahead of time, that the beneficiary account will be able to receive the funds.
"While currency controls and regulatory approval processes will always cause some delays in the payment process, many payment flows can be sped up by ensuring the correct information is provided upfront," Harry Newman, head of banking at Swift, said in the release.
"Invalid beneficiary information is the first cause of returned or rejected payments," Newman added. "Eliminating these detectable and preventable errors and omissions will make international payments much more efficient."
Currently, more than 220 financial institutions around the world are using Swift's GPI process, which debuted more than a year ago to establish common procedures and messaging for all banks, while also adopting new technology to operate alongside legacy systems.