The Intercope team attended Sibos in Amsterdam – with 9000 other members of the global banking operations community.
What did we spend the week talking about? Here’s a summary:
The business agenda was dominated by payments and its infrastructure. Nobody really wanted to talk about anything else – bankers are rightly concerned about ISO 20022 migration programmes (the plural is deliberate). They’re interested in Instant, Real-Time or Faster schemes as they roll out around the world, and even digital currency gets more coverage than we had expected. They are also rightly concerned about whether the infrastructure they use to participate in these schemes is fit for purpose. So – what were people saying?
– ISO 20022 is a Big Deal. Market Infrastructures, from Target2 to the Federal Reserve, are monitoring the readiness of their participants – and finding a huge variation, from “ready” to “what is ISO 20022?”. SWIFT is reporting positively about the readiness of the CBPR+ community – meaning ALL banks and financial institutions worldwide – and optimism is rarely out of place in a trade show like Sibos. Realism, however, is also very useful. Since Sibos, the European Central Bank has declared a delay to its Target2 migration date, from November until April 2023, to give the laggards in Europe a few months to catch up. The details “behind the scenes” may well leak out over the coming weeks and months; in the meantime, our customers are getting ready for changes to their own ISO 20022 rollout planning, confident that their infrastructure is ready for them.
– Faster payments schemes – including “instant” and “real-time” – are common now. The questions are about the next steps – when the new schemes take over from the old, when the old schemes can be properly retired etc but also about the impacts of instant payments that haven’t yet been fully played out. For example – instant payments mean instant settlements – which implies real-time liquidity management and possibly, an intra-day time value of money. Today, by comparison, borrowing money means paying interest – but only if you borrow it overnight. In future, borrowing money for a few hours to settle intraday instant payment obligations might also cost money – but the infrastructure (systems, standards and rulebooks) necessary to do that at scale does not yet exist. Interesting!
– Transaction Manager is the core deliverable of SWIFT’s strategic push up the value chain. It will start getting rolled out next year, but it will be a while before it starts adding significant value to the payments process. SWIFT plans to start extending it into the world of Securities operations, and there was some evidence on show of how SWIFT intends to lay the groundwork for this (adding a “Unique Transaction Identifier” to securities trade confirmations, very much like the UETR on Payments, so as to be able to identify messages related to a single transaction and report status, like SWIFTgpi does for payments). Watch out for Securities View over the coming year.
More informally, most “corridor” conversations of the week were all about one thing – how great it was for the community to be able to meet in person again, so that matters of business substance can be surfaced, discussed and debated with dozens of leading practitioners, in a huge variety of formal and informal contexts. Sibos is back – long live Sibos!