Upload
muhammad-haider
View
85
Download
0
Embed Size (px)
Citation preview
Electronic Banking
Electronic BankingElectronic Balance and Transaction
Reporting (EBR)
• Usually provided by relationship bank(s)• May be used to access accounts with single or
multiple banks• MT940 used for end of day balances - assist reconciliation to provide daily cash
position - may provide anticipated cleared balance
information• Some banks are able to provide intra day
reporting via MT942
Electronic BankingElectronic Funds Transfer (EFT)
• Offline batch or Browser based• Interface with TMS avoids re-keying• Templates - pre defined beneficiaries - sort code, IBANs etc• Will allow a wide range of different payment
types - primary payment types are MT102 (mass
payments) and 103 (single customer credit transfer)
- MT101 Multi-bank payments
Electronic BankingE-Commerce: Portals and Exchanges
Companies may use single bank dealing portal because
• Independent verification of the rates• May be incentive to deal on-line (rate)• Small exposures may be hedged
automatically if linked to TMS
Simplify the audit trail
Electronic BankingMulti-bank Portal
Co A
Co B
Co C
Hub
Bank A
Bank B
Bank C
Electronic BankingMulti-bank Portal
• Input deal, dates- currencies- amounts• Banks to be approached• Bid transmitted• Banks ‘auto bid’ direct from their system• Dealer has short time to accept• Deal accepted and other bids discarded• If linked, TMS produces confirmation
Electronic BankingMulti-bank Portal
Advantages to:• Corporate
– Well documented competitive quotes– Transparency or ‘price discovery’– Can spread business– If well integrated leads to STP
Electronic BankingMulti-bank Portal
• Bank– High volume, low margin business may be
done more cost effectively– Greater chance of winning some business– Access to a wider range of customers– Small value, exotics
• Exchanges• A messaging service
Electronic BankingExchanges
• A messaging service• Different types of financial messages• Expands services available
Electronic BankingE-Commerce: Working Capital
• Invoicing or einvoicing ‘the substitution of inbound/outbound paper invoices with an electronic file’– EBPP, Electronic Bill Presentment and
Payment– EIPP, Electronic Invoice P & P– ERS, Evaluated Receipts Settlement– POP, Paid on ProductionNB in EU directive 2001/115/EC, into effect in
2004, member states must accept einvoices.
Electronic BankingE-Commerce: Working Capital
• Desktop capture• Letters of Credit• Reconciliation • Interest apportionment
Electronic BankingE-Commerce: Working Capital
• Why is Security important?• Fraud• Theft• Contamination• Data security• Error• Non repudiation
Electronic BankingSecurity
So how do we attain security and have a system that works?
• Authorisation for payments/deals• Segregation of duties (back office/dealer)• Physical security
– Dedicated computers for payments– Separate room– Password protected
Electronic BankingSecurity
• Different levels of authorisation/activity– Input– Second input– Verification– Authorisation and release
• Free format• Pre-format
Electronic BankingSecurity
• Encryption or cyphertext– Private key or symmetric– Public key or asymmetric (public key
infrastructure, PKI) not only ensures confidentiality but also
provides authentication of the sender thus preventing repudiation
– SSL, Secure Sockets Layer– HTTPS, Hypertext Transfer Protocol, Secure
Electronic BankingSecurity
• Digital Signature• Uses the asymetric method to perform two
functions– Authentication– Integrity
public key encryption does not identify the sender. Digital signatures fill this gap.
• Digital certificates
Electronic BankingIntegration and Standards
• Extensible Mark-up Language, XML• Some standards groups:
– Rosettanet– TWIST or Treasury Workstation Integration
Standards Team