How SWIFT gpi is transforming Cross-Border Payments

SWIFT gpi has revolutionized the way businesses make international payments. By introducing a standard to track payments in real-time, companies can now make and receive payments with greater security and speed than ever before. Let’s take a closer look at what makes SWIFT gpi such an important development in cross-border payments.

To remain competitive, banks must revolutionize cross-border payments to become the go-to bank for corporate needs.

The demand for faster, better and more efficient cross-border payments from corporates around the world has been growing. The need for transparent investigation processes, payment credit tracking and deduction analysis is paramount within corporate treasury departments for better working capital decisions. This can only be achieved by utilizing innovative new technologies that are transforming the way these payments are executed - from improved fraud detection mechanisms to digitization of documents. With increased competition in this digital age corporates are needing Financial Institutions to quickly adapt to the ongoing change and deliver better services when it comes to cross border payments.

Cross-border payments can prove to be a difficult and costly process for corporates due to the inability to track their payment status. Without a proper system in place, corporates risk facing unanticipated cash flow issues and strained relationships with suppliers if timely payments are not made. It is also particularly challenging for them to reconcile payments often caused by incorrect remittance information, leading to an increased cost towards manual reconciliation policies. All of this results in huge economic losses, making it important for businesses to find ways to efficiently manage and monitor cross-border payments.

The features of SWIFT gpi that corporate payments heads need to know

SWIFT gpi enables payments to be traced globally from start to finish with the help of a Unique End-to-End Transaction Reference (UETR). To ensure reliable tracking, UETR and GPI service code are introduced in Message Block 3. Banks can utilize FIN Messaging or APIs via GUI for successful tracker updates while SWIFT's Global Payments Innovation Observer gives all its participating banks an overview of their performance against SLA benchmarks. Moreover, every bank authorised for sending and receiving global payments is listed on the directory alongside its BIC code.

The Benefits of SWIFT gpi

SWIFT gpi is is a cloud based solution offered by SWIFT that enables banks and corporate to track international payments in real-time leveraging SWIFT GPI tracker component. This means that businesses can now make and receive international payments with greater security and transparency than ever before. Here are some of the key benefits of using Swift GPI:

Faster Payments: With SWIFT gpi, global payments can be received in as little as 30 minutes- a huge advancement over traditional methods. The gCCT Inst service connects the SWIFT gpi to domestic real-time payment networks and ensures efficient cross border transactions beyond normal business hours with funds available that same day. This makes cash management easier and allows businesses to make more informed capital decisions faster than ever before! ( As per data from SWIFT?(1)around 40% of payments are credited within 5 minutes, 50% under 30 minutes, and nearly 100% under 24 hours. )

Greater Transparency: With traditional methods, it was often difficult to track where payments were in the process or if they had been received by the recipient bank. With SWIFT gpi, however, businesses have access to real-time tracking information so they can always know the status of their payment, including when it has been credited to the recipient’s account. This allows the corporates to track both incoming & outgoing payments easily with complete transparency to the fees/charges deducted in each leg of the payment. Also, corporates can view all the banks/parties involved in the transaction.

Secure Payments: Because all transactions are tracked in real-time via an immutable audit trail, there is less risk of fraud or misdirection of funds. The improved security provided by SWIFT gpi helps reduce costs associated with fraud prevention while also providing greater peace of mind for both parties involved in the transaction.

Conclusion:

SWIFT gpi is transforming how businesses make cross border payments by introducing faster speeds and greater transparency than ever before. It provides companies with more secure transactions and better control over their cash flow thanks to its real-time tracking capabilities.

SWIFT gpi offers an unparalleled level of corporate banking efficiency, with a range of solutions such as gCCT( SWIFT gpi customer credit transfer), SWIFT GO ( for low value remittances) , pre-validation, gpi SRP ( stop and recall payments), gpi Case resolution, gpi Pay & Trace etc to name a few. Adopting these service offerings combined into one powerful tool enables banks to create a mutually beneficial customer relationship where corporate clients can improve the cash and liquidity management while banks can reduce their payments operational cost for exceptions and investigations.

As a bank, you need to ensure that your payments platform is compliant with SWIFT gpi and can update the status of a message to the GPI tracker. On your corporate channel you need to provide your clients with a GPI-tracker to view the status of incoming and outgoing payments and even if your bank is not a GPI Member, all SWIFT FIN members must update the gpi service via an MT199.

Thanks for reading and make sure your bank is prepared with a solid infrastructure to take advantage of all the benefits offered by GPI!

Reference:

(1)?https://www.swift.com/our-solutions/swift-gpi/about-swift-gpi/fast-transparent-and-trackable-payments