Financial institutions: Migration through their own efforts
Financial institutions are basically responsible for their own migration to ISO 20022. They are also independent when it comes to the information and cooperation with bank customers and software partners.
The migration and harmonization of payments to ISO 20022 impacts all bank customers. Particularly business customers that use individual or customized payment transaction software will be confronted with consequences
As a financial institution, you should support your customers during the migration. It is important that you:
Inform your customer representatives about the situation early on and integrate them into your migration plans;
Make the positions in charge within your organization aware that the migration is mandatory from a regulatory perspective. Only with a compliant migration can you adhere to the rules stipulated by the Money Laundering Act and other regulations;
Make your business customers aware of the advantages, the time sequence, the necessity and the specific steps involved in the migration;
Show your business customers what they specifically must do during the migration. Especially point out to your business customers that they should involve their IT department or software partner;
- Inform your business customers that, in addition to questions about software (e.g. about updates to programs and interface) questions concerning hardware (e.g. reading devices for the new inpayment slip of the printers needed) may arise.
The facts in brief
Regulatory requirements (e.g. Anti-Money Laundering Act)
Banks, software partners and business customers must be aware that, from a regulatory perspective, there is no way around the migration to ISO 20022.
Business customers will only be able to submit payments with the pain.001 message (customer credit transfer initiation) after mid-2018, instead of the current DTA (at banks) or EPO (at PostFinance). At the same time, they must be able to receive pain.002 messages with which the banks can inform their customers about the status of the payment instructions transmitted.
Nevertheless, it is possible that business customers may not yet have placed the IBAN in their accounting software. Inform them that they must also use the IBAN for their domestic payments from 2020.
- During a transition period between 2016 and mid-2018, a parallel usage of the current DTA or EPO and the new pain.001 message is possible for payment instructions. As a financial institution, you must coordinate the duration of the parallel operation.
Cash management (notifications/reporting)
- Recommend that your customers also switch to notification on camt messages during the migration to pain message to ensure the straight-through processing of the data.
- As a financial institution you must ensure – along with your internal and external software partners – that you can provide your business customers account statements at the end of the day with the camt.053 message. If you also offer intraday account statements or debit and credit notices, these too must also be migrated to ISO 20022 (camt.052 and camt.054).
- Instruct your business customers that they should make the migration as simple as possible for all participants. The work required among payment recipients should be kept to a minimum and be avoided entirely among payers.
- The direct debit procedures are planned to be combined with the e-bill by mid-2018. PostFinance intends to use the same standard for e-billing and direct debiting as the banks.
- The planned changes to the procedures (including the deadlines) do not impact the consumers acting as debtors. Debit authorizations that have already been issued, should remain valid.
- The submission of direct debit instructions by business customers will now take place through the e-billing system. As a financial institution, you can enable customers to submit the instructions through their own channels, in order to route them to the e-billing system themselves. Your business customers receive their customers’ direct debit authorization electronically through the e-billing system.
Inpayment slip with data code
- The present inpayment slips will be replaced by a standard inpayment slip with data code between mid-2018 and mid-2020. Therefore, as a financial institution, as of mid-2018 you should be able to process your customers’ bills with pain messages according to the new processing method.
- Motivate your business customers, as creditors in the parallel operation phase between mid-2018 and mid-2020, to switch to the new inpayment slip with data codes and camt messages for credit notifications (camt.054).
- As a financial institution, you can set the precise duration of the parallel operation yourself. Inform your customers in a timely manner if you no longer wish to support old inpayment slips before the generally communicated end date in mid-2020.
- Business customers need not be encumbered with the provision of the inpayment slip with data code by their forms supplier. They will be informed centrally by the financial center working group. However, should your business customers plan to use up old form stocks (e.g. preprinted forms), they should in turn inform their own customers about the migration in a timely manner and make sure that they do not provide any further old slips.
- Instruct your customers that when purchasing a new reading device for the new inpayment slip, that they must make sure that it supports the QR code.