Trading, analytics, treasury, and risk management solutions provider ION has partnered with Raiffeisen Bank International (RBI) to implement its ISO 20022 solution. A corporate and investment bank activating in Austria and Central and Eastern Europe (CEE), RBI selected the solution to help it meet the new TARGET2 and SWIFT CBPR+ ISO 20022 initiatives.

RBI – ION collaboration details As per the press release information, RBI has leveraged ION’s Wallstreet FX (WSS FX) solution since 2003 for managing its FX and Money Market risk, as well as for front-to-back high STP processing. Additionally, since 2021, ION has cooperated with RBI on the latter’s ISO 20022 adoption strategy. Led by central banks and SWIFT’s joint effort to standardise financial transactions, ISO 20022 has been working towards modernising cross-border payments.

Enabling increasingly rich and structured granular data in payment messages, ISO 20022 helps banks process, screen, and validate more efficiently against sanctions lists to combat fraud in an effective manner. Additionally, the solution brings forth operational benefits of the likes of improved KYC analytics, less manual intervention, and decreased risks and costs. ION’s ISO 20022 technical messaging system assists users with navigating the transition, and its implementation to RBI enables the latter to process settlement requests both from ION’s existing WSS FX and other back-office applications across the bank.

As it supports the rich and structured data in ISO 20022, the new messaging hub is set to provide an increasingly efficient end-to-end payments experience for RBI’s clients. What is more, the ION solution natively supports the required ISO 20022 messages formats, and by offering access to TARGET2 and SWIFT CBR+ libraries, it helps remove the time-consuming translation process, enabling improved and expedited end-to-end payments management. As such, RBI can ensure quickly that its cross-border transactions are compliant with the new standard, securing a hassle-free transition for the bank and its clients alike.

Harald Müller, Head of Group Capital Markets at RBI stated that their priority is to provide clients with a simplified and efficient banking experience, and as ISO 20022 is moving towards becoming the de facto messaging format for cross-border payments, they recognised the need for migration readiness. The spokesperson believes the implementation of the new ISO 20022 messaging system solution to help ensure they can address the challenges of the new standard. Adding on this, Eugene Markman COO of ION FX stated that by collaborating with RBI on their ISO 20022 strategy for the past two years, they gained an understanding of the challenges brought forth by the new messaging format.

Per their statement, their ISO 20022 solution was designed to address these concerns and is set to help RBI and other clients meet the new requirements, realise additional settlement opportunities, and further the way for an increasingly standardised, efficient payment landscape. ISO 20022 standards Eugene Markman confirmed for The Paypers that ISO 20022 is the dominant global language for payment messaging, being leveraged by payment systems in more than 70 countries. It is expected to become the de facto standard for high-value payment systems of all reserve currencies by 2025, supporting 80% of payment volumes worldwide.

Standardisation in payments processing is believed to enable banks and payment providers to achieve increased automation and STO of sending and receiving payments, together with full transparency and granular tracking information, better effectiveness of fraud detection and prevention measures, and improved insight into the business purpose of customer payments, which helps financial institutions create more value-added services. Among the developments to have taken place surrounding ISO 20022, the spokesperson named several migration updates, namely SWIFT’s initial transition phase go-live announced in March 2023, with mandatory migration to be finalised by November 2025 and The European Central Bank (Target 2) migration in the same month. What is more, further migration to ISO 20022 is planned for the next two years in the US, Australia, Canada, Hong Kong, and Singapore.

As adopting ISO 20022 requires significant planning and investing, should an institution fail to comply with the specific requirements of individual payment markets, it could be prevented from taking part in the payments system. .