subject: What Is New About Payments & SWIFT [print this page] There is lots happening in the Payments area especially after the Global meltdown. Banks have started to rationalize their Payment systems by consolidating disparate system. How can SWIFT stay behind in the game. In a recent move they have taken over SunGard's Ambit Messaging Hub. So let us now understand how this move is going to help SWIFT. They already have a significant volume of global payment business in their kitty. All global banks using the network for settling their Payments transactions. With the messaging Hub they have moved a step behind should I say. SWIFT was a network operator but now they have stepped into a domain that was typically served by software companies like Sungard and the likes.
The messaging Hub can give a single channel to all the banks payments message to interface with the Alliance Access. There is no need to have multiple interfaces. Banks have already wanted to do that and now they are actually doing it. It greatly reduces their cost of Payment operations and improves efficiency. SWIFT's target for 2015 is to give the company additional flexibility in pursuing more commercially and client focused activities. I guess the move is because Banks want a little more from SWIFT than just being a International settlement service provider. One thing is clear from the Sungard acquisition that SWIFT wants to get inside the Banks IT space.
Banks generate huge volumes of information in terms of Payment messages and additonal information that need to be processed fast for International Trade. SWIFT does that pretty efficiently. Now the next SWIFT acquisition will give us a fair idea of what would be SWIFT's strategy. Would they want to go for backward integration and try to get more chunks of business from the Banks internal processes or would they play more on the settlement business that is their core. We need to trail the developments closely. Since SWIFT influences global payments to a great extent, their strategies can be taken as an indication of what is next in the Payments business.
