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Slide 1
Frank VandammeSenior Manager, StandardsSWIFT
UNIFI UNIFI (ISO 20022)(ISO 20022)““creating interoperability creating interoperability for the financial industry”for the financial industry”
OASIS Symposium, San Francisco, 9 May 2006
Slide 2
SWIFT
SSociety for WWorldwide IInterbank FFinancial TTelecommunication
– CommunityCommunity: financial institutions active in payments, securities, treasury and trade services
– NetworkNetwork: secure and reliable network application
– StandardsStandards: standardized information flows (messages) Some figures:
– Established in 1973
– 7,850 users in 204 countries
– More than 11 million messages per day
– Yearly growth more than 10%
Slide 3
A typical business transaction
Business transaction = all communication to fulfil request from originator to
beneficiary
Please pay CORP2 100.000 USD (net) by 31 Aug 2005, for invoice “corp2_143”. Indicate a difference of 25.000 USD with the requested amount due to
non-delivery of one article
Slide 4
A typical business transaction
Please pay CORP2 100.000 USD (net) by 31 Aug 2005, for invoice “corp2_143”. Indicate a difference of 25.000 USD with the requested amount due to
non-delivery of one article
Paymentinitiation Statement
What is required to make this business transaction work? • All necessary communications are foreseen• All required information can be obtained and/or forwarded where and when necessary
Credit confirmation
Investigation
Inerbank settlement
Interbank settlement
Response
Interbank transferStatement
Credit transfer instruction
Credit transfer instruction
Slide 5
Standards landscape in the financial industry
EACT
FPML
ISDA
IFSA
TreasuryTreasury
TWIST
SWIFT
Bolero
ICC
IIBLP
UNCITRAL
IFSA
Trade FinanceTrade Finance
EAN/UCC
SWIFT
FIX
ISITC-IOAISSA
SMPG
SIA
FISD/MDDL
G30
Giovannini
BMA
SecuritiesSecurities
SWIFT
EPC/ECBS
ISTH
IFX
RosettaNet/PMP
OAGi
X12
PaymentsPayments
Fedwire
CHIPSTCH
NACHA
SWIFT
TC68/SC4
WG
8 & WG
11
TC68
/SC6&
7
CEFACT/
TBG
5
TC68/SC4&7
CEFACT/
TBG
15
W3CUN/CEFACT
MoU/MG
OMGISO
OASIS
Slide 6
OAGiIFX
EPC
ISTH
Edifact
X12
A typical business transaction … impacted by the standards landscape
Swift
FedWire
?
?
?
?
?
?
?
?
?
?
?
Slide 7
UNIFI (ISO 20022) Building towards a common approach
EACT
FPML
ISDA
IFSA
TreasuryTreasury
TWIST
SWIFT
Bolero
ICC
IIBLP
UNCITRAL
IFSA
Trade FinanceTrade Finance
EAN/UCC
SWIFT
FIX
ISITC-IOAISSA
SMPG
SIA
FISD/MDDL
G30
Giovannini
BMA
SecuritiesSecurities
SWIFT
EPC/ECBS
ISTH
IFX
RosettaNet/PMP
OAGi
X12
PaymentsPayments
Fedwire
CHIPSTCH
NACHA
SWIFT
TC68/SC4
WG
8 & WG
11
TC68
/SC6&
7
CEFACT/
TBG
5
TC68/SC4&7
CEFACT/
TBG
15
W3CUN/CEFACT
MoU/MG
OMGISO
OASIS
UNIFI UNIFI ISO20022ISO20022
Slide 8
UNIFI (ISO 20022)Main drivers
Improve qualityImprove quality
– Ensure end-to-end interoperabilityEnsure end-to-end interoperability
– Support diversity (market practices)Support diversity (market practices)
– Improve STP (Straight Through Processing)Improve STP (Straight Through Processing)
– Reduce ambiguityReduce ambiguity
– Increase business focusIncrease business focus Reduce implementation costs (& TCO)Reduce implementation costs (& TCO)
– Reduce impact of proprietary technologyReduce impact of proprietary technology
– Increase automation capabilitiesIncrease automation capabilities
– Reduce impact of maintenanceReduce impact of maintenance Improve time-to-marketImprove time-to-market
Make it better, faster & cheaperMake it better, faster & cheaper
Slide 9
UNIFI (ISO 20022)Major components
UNIFI objective = develop standardised information flowsUNIFI objective = develop standardised information flows
Modelling-based standards development (UML)
Repository (data dictionary & business process catalogue)
Syntax-specific design rules (XML)
Registration process
Reverse engineering approach
Parts 1 & 2
Technical Specifications
1, 2 & 3
Slide 10
UNIFI (ISO 20022)Standards development methodology
Three layered approach Business-oriented Communication needs End-to-end view Formal notation (UML) Representation-neutral Implementation-neutral Foster reuse (dictionary) Involve industry experts
Business AnalysisBusiness Analysis
Requirements AnalysisRequirements Analysis
Logical AnalysisLogical Analysis
Logical DesignLogical Design
Technical DesignTechnical Design
Technical ImplementationTechnical Implementation
Understand the business
What is the communication
problem
Define the solution
Refine the solution
Generate message
formats(automated)
Slide 11
ISO 20022 Standards Repository
DATA DICTIONARY BUSINESS PROCESS CATALOGUE
UNIFI (ISO 20022)Standards repository
are describedwith
use
BUSINESS AREAS
support execution of
BUSINESS TRANSACTIONS
BUSINESS CONCEPTS
MESSAGE CONCEPTS
DATA TYPES
are derived from
Slide 13
UNIFI (ISO 20022)Registration bodies
Registration Authority (RA)
ISO
Communities of users & developers
Standards Evaluation
Groups (SEGs)
Securities
Payments
ISO
…
Registration Management Group (RMG) ISO
ISO 20022Repository
Data Dictionary
BusinessProcess
CatalogueISO
Slide 14
UNIFIStandards
Evaluation Groups
ISTH
MDDL
FpML
SWIFT
FIX
ISO WGs
TBG5
CoreComponents
CommonBusiness
Processes
DataDictionary
BusinessProcess
Catalogue
ebXML Registry/Repository
www.iso20022.org
UNIFI FinancialRepository
UNIFIRegistration
Management Group
Securities
Payments
UN / CEFACT(All Industries)
UNIFIRegistration
Authority
UNIFIUsers
BusinessRequests
MessageModels
TBG17Harmo-nisation
UNIFI (ISO 20022)Long term convergence goal
under investigationunder investigation
under investigationunder investigation
Slide 15
UNIFI (ISO 20022)Interoperability based on modelling …
Order
DateDate
Account
Order
Date
XML FIX FpMLEdifact
SWIFT
Slide 16
UNIFI (ISO 20022)… and reverse engineering
Execution Report Tag Field Name Re
q'd Comments
Standard Header Y MsgType = 8
37 OrderID Y OrderID is required to be unique for each chain of orders.
198 SecondaryOrderID N Can be used to provide order id used by exchange orexecuting system.
11 ClOrdID N Required for executions against electronically submittedorders which were assigned an ID by the institution. Notrequired for orders manually entered by the broker.
41 OrigClOrdID N Conditionally required for response to an electronic Cancelor Cancel/Replace request (ExecType=PendingCancel,Replaced, or Canceled). ClOrdID of the previous order(NOT the initial order of the day) when canceling orreplacing an order.
109 ClientID N Used for firm identification in third-party transactions.
76 ExecBroker N Used for firm identification in third-party transactions.
382 NoContraBrokers N Number of ContraBrokers repeating group instances.
375 ContraBroker N First field in repeating group. Required if NoContraBrokers> 0.
337 ContraTrader N
FIX, FpML, SWIFT, …
Complete &Complete &UpdateUpdate
Order
DateDate
RepositoryCompareCompare
Account
Order
Date
Convergence InformationFIX-FpML- XML
:25: acctId
:61:sub5 ntryAmt
.. ..
SupportSupportcoexistencecoexistence
XML
FIX, FpML, SWIFT, …
Slide 17
UNIFI (ISO 20022)Conclusion
Improving interoperability todayImproving interoperability today
– Registration bodies are up and running
– More than twenty countries and organisations
Building for the future through ISO TC68 / WG4Building for the future through ISO TC68 / WG4
– Identifying further alignment and enhancements
– Active participation of organisations like OMG, UN/CEFACT, FpML, SWIFT, TWIST, MDDL, …
Financial industry is achieving Financial industry is achieving interoperability through UNIFIinteroperability through UNIFI
UNIFI UNIFI ISO20022ISO20022