Although the ongoing pandemic brought significant disruption, it is also having the positive effect of bringing the digitalization agenda to the fore. And as flows of funds between Latin America and the rest of the world are returning to normal levels, the pandemic has precipitated a permanent change by speeding up the adoption of digital payment services, says Dino Sani, Head of Treasury Services for Latin America at BNY Mellon.
“BNY Mellon was already in this journey toward digitalization but COVID-19 accelerated the process,” Sani said. “And there’s a dramatic impact on our business.”
Latin American banks have been quick to embrace Swift’s Global Payment Initiative (GPI), a collaborative project in which participating banks build on an open platform (API) to add speed and transparency to international payments, according to Sani. And although Latin America’s economies to face a difficult year in 2021 as they open slowly, Sani expects an economic recovery to get underway. “We are seeing some light at the end of the tunnel,” he said.
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Published in 2010, SWIFT’s guidebook ‘ISO 20022 for Dummies’ presents a useful tool to gauge the changes in thinking toward ISO 20022 over the last decade. In an article with Finextra, Isabel Schmidt, Global Head of Direct Clearing and Asset Account Services, BNY Mellon Treasury Services, explores how assertions and predictions made about the migration have played out over the last decade.
Schmidt explains that while a lot of industry discussions currently focus on payment messages and core cash management messages, “overall thinking has also evolved to embrace the concept that a more robust payment message also provides the basis for major efficiency potential in the pre- and post-payment exception and investigations space.”
Schmidt explores how SWIFT’s first attempts to help banks improve this space dates back over 10 years when the E&I initiative was launched and that unfortunately the initiative lacked a sufficiently robust standard to really enable comprehensive automation of exception workflows.
“This space is now being revisited, based on more structured and more robust payment data which the ISO 20022 standard will provide. This is a considerable incremental efficiency opportunity for banks and a further step towards a much-enhanced client experience end-to-end.”
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While global trade volumes have been down significantly in 2020, Joon Kim, the Global Head of Trade Finance Product and Portfolio Management at BNY Mellon, sees “a cautious sense of optimism and recovery” by the latter part of the fourth quarter of this year and the beginning of next, at the macro-level.
Arnon Goldstein, Head of Treasury Services for Asia Pacific at BNY Mellon, observed overall decline in payment volumes, underlining weakness in clients’ demand, but an increase in liquidity, especially in local currency and dollar liquidity as lending demand has been depressed. However, any rebound in volume will be uneven as some economies continue to grapple with the COVID-19 pandemic.
The disruption to traditional supply chains and logistics has precipitated the need to strengthen business continuity planning to increase institutions operational resiliency and ability to operate remotely. Processes have to be streamlined and enhanced to incorporate alternative digital solutions, such as e-signature and biometric-enabled authentication and authorisation, to replace traditional manual ones. The bank is pivoting to digital alternatives, such as web-based meeting, and digitising more of its internal as well as clients’ processes in order to facilitate client transactions and increase efficiency.
To watch the interview, please click here.
The COVID-19 pandemic is shining a spotlight on the importance of stable supply chains – and their role in achieving business continuity. Buyers are markedly more conscious of the impact their suppliers have on their ability to provide services and are increasingly using sophisticated digital tools to help protect them.
Adeline de Metz, UniCredit’s Global Head of Working Capital Solutions explains how corporates must continue to optimise working capital strategies and use tools such as reverse factoring and digital dynamic discounting – which have, promisingly, seen increased adoption since the beginning of the crisis – in order to bolster supply chains and help lay the foundation for economic recovery.
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Following the COVID-19 pandemic, the US liquidity landscape is changing. With low-interest rates already dominating the US because of the 2008 financial crisis, treasurers face greater challenges as they navigate today’s volatile market conditions.
Against this backdrop, Tom Meiman, Product Line Manager for Liquidity Balances and Demand Deposit Account Services, BNY Mellon Treasury Services, and Sam Schwartzman, Head of the IMG Cash Solutions Group, BNY Mellon Markets explore how cash managers can use investment and deposit accounts to effectively optimise their surplus operating cash.
Click here to read Part One and Part Two (the articles have been published in Spanish).
The Covid-19 pandemic is presenting global trade with exceptional challenges. With disruption to many supply chains due to large-scale logistics obstacles, and many sectors seeing significant decreases in demand, exporters must traverse an uncertain, unfamiliar landscape.
Prior to the pandemic, significant efforts were already being made by many banks to enhance trade finance through technological innovation. But events of the past few months have spurred a flurry of activity from blockchain to optical character recognition (OCR). Participants have been required to move away from ingrained, paper-based procedures and adopt digital solutions in order to ensure their businesses can continue to operate effectively.
In an article for GTR, Joon Kim, Global Head of Trade Finance Product and Portfolio Management, BNY Mellon Treasury Services, explains how banks are addressing these short-term challenges, and looking to a digital future.
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As a result of the global lock-down, almost every aspect of trade – from value chains and logistics networks, to pending and production – has faced a series of profound challenges. With the grip of the situation still being felt the world over, what is being done to optimise the flow of trade finance transactions? In an article for TRF News, BNY Mellon’s Joon Kim, Global Head of Trade Finance Product and Portfolio Management, explains.
For one, there has been a significant shift in attitudes towards the digitalisation of trade finance. As a traditionally physical, paper-intensive business, trade finance, when performed from a ‘working from home’ environment, has encountered a number of challenges. And, as it became clear that lockdowns would remain in place for the foreseeable future, the industry reacted swiftly – coming together to adopt a series of digital initiatives.
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For some years, the payments landscape has been experiencing a shift from paper to digital solutions, with developments, including new real-time payments systems, the emergence of innovative overlay services, and the modernization of legacy rails, coalescing to meet evolving client needs.
Speaking on Fintech Finance’s Virtual Arena, Carl Slabicki, Head of Strategic Payment Solutions, BNY Mellon Treasury Services, explains how the Covid-19 pandemic has acted as a catalyst to drive forward this digital transformation. “As more and more businesses made the move to a remote working environment, BNY Mellon has had to adapt to better support their clients with accessing data, to afford capabilities from remote settings, and to provide increased assurances” says Slabicki.
To watch the full interview, please click here.
The introduction of ISO 20022, the new payments messaging standard, is set to revolutionise the payments industry. The existing infrastructures, including SWIFT MT messages and their proprietary equivalents, are no longer suitable for modern payment needs. By replacing them, the industry aims to create a messaging ecosystem that can facilitate an efficient, value-added payments experience for clients.
Of course, these benefits will come at a cost. Preparing for the new standard will require substantial efforts and resources from banks. It crucial that banks be fully apprised of the impending developments, understand what is required and have effective strategies in place. BNY Mellon’s Isabel Schmidt and Marcus Sehr explore in an article for the International Banker.
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The introduction of ISO 20022, the new payments messaging standard, is set to revolutionise the payments industry. ISO will replace existing SWIFT MT messages and their equivalents, which are unsuitable for supporting evolving transaction needs, as the format for the transfer of cross-border and high-value payment information. Crucially, the new messages will incorporate more structured, robust and comprehensive data, thereby driving enhanced speed and efficiency; reducing false positives, manual intervention and costs; and helping to pave the way to 100% straight-through processing (STP).
As these deadlines draw nearer, considerable efforts and resources from all participants will be necessary to meet the associated challenges. But, by establishing a clear transition roadmap, educating staff and upgrading their systems, banks – and their clients – can unlock the full benefits of ISO 20022.
The article can be read here