The ISO 20022 countdown enters the final stretch

ISO 20022 is the open global standard for financial information to enable consistent, rich, structured data for payments. Quality data brings a wide range of benefits to both banks and corporates, ranging from increased efficiency and elevated customer experience to cost savings – plus improved fraud and theft control.

The journey to ISO 20022 is entering the critical phase and the final ISO 20022 countdown has officially started. The November 2025 deadline for banks to migrate to ISO 20022 should be the target date for corporates as well. Corporates can see results from the migration, including improved cash flow management and cross-border payment experience, plus automatic payables and receivables reconciliation, almost immediately. It’s important to note that the Federal Reserve Banks are planning to implement ISO 20022 messages for Fedwire eight months earlier, on March 10, 2025, sunsetting the current FAIM format.

Whether you’re a financial institution, a payment service provider, or a corporate entity, this guide is designed to help you embark on the journey towards ISO 20022 adoption with clarity and strategic intent. Please note that many of the tasks below can be done in parallel or at different speeds, depending on the size of your operation, your available resources, and your business priorities. It’s all based on your capabilities and requirements. Let’s keep up with the ISO 20022 countdown!

2023 milestones: Developing an ISO 20022 migration plan

As the ISO 20022 countdown continues, there are still things to be done in 2023. Start your migration journey by developing a comprehensive ISO 20022 migration plan that encompasses the following aspects:

Educate your team, define your strategy and conduct a gap analysis

The first step in defining an ISO 20022 migration plan requires thorough analysis, strategic thinking and a team of skilled staff. You need to get it right from the beginning, so be sure that all involved stakeholders have the necessary ISO 20022 knowledge before you do anything else. You can then create your high-level strategy for the project. It is also recommended to implement a robust training program as part of the overall strategy, to equip your team with the necessary skills and knowledge to work effectively with the ISO 20022 standard. This includes:

Conducting training sessions for IT, operations, compliance, and customer service teams on ISO 20022 principles, message formats, and usage.
Raising awareness among stakeholders about the benefits of ISO 20022 compliance, including enhanced data exchange, improved reporting, and streamlined processes.

Once you have a high-level strategy, perform a comprehensive gap analysis of your organization’s current systems, processes, and data formats in comparison to the requirements of the ISO 20022 messaging standard. As an integral part of your ISO 20022 migration plan, this analysis will help identify areas that need to be addressed for compliance. Your analysis should include:

Review of all payment and messaging systems used within the organization
Assessment of their readiness for ISO 20022 adoption
Documentation of any gaps/challenges to adoption, and what may be required to solve them

Remember, banks should initiate early communication with their corporate clients, ensuring they understand the impending changes and their role in the process. Corporates, on the other hand, should engage in discussions with their bank(s) to ensure alignment.

Form an implementation team

Once the gap analysis is complete, assemble a dedicated implementation team with representatives from different departments across the organization. This cross-functional team will play a crucial role in planning and executing the ISO 20022 compliance efforts. Throughout your whole development of an ISO 20022 migration plan, be sure to:

Include experts from IT, operations, compliance, finance and customer service, among others
Assign clear roles and responsibilities to each team member
Ensure strong leadership support for the initiative

Get ready for the ISO 20022 implementation

As part of your ISO 20022 migration plan and based on the strategy, the findings of the gap analysis and input from the implementation team, create a comprehensive ISO 20022 implementation strategy that includes:

A detailed roadmap with specific milestones, timelines, and action items needed to achieve compliance by the deadline
All aspects of the implementation including system upgrades, data mapping, staff training, testing, and communication with stakeholders
Regular review and update of the plan as the implementation progresses together with the ISO 20022 countdown to ensure you’re on track to meet the deadline

2024 milestones: ISO 20022 implementation

As the ISO 20022 countdown continues full speed ahead in 2024, it is time to put theory into practice and execute your ISO 20022 migration plan. This includes the following steps and considerations.

System upgrades and ISO 20022 integrations

Based on the gap analysis, identify the necessary upgrades and integrations required to align your existing systems with the ISO 20022 standard. Work closely with your IT team and software vendors to implement any required changes. Do not overlook your back-up sites. The bullets below are key ISO 20022 integrations as well as integration points.

A. Payment application

ISO 20022 integration means integrating your existing payment application, such as online banking systems or payment gateways, with ISO 20022 messaging formats. This integration will allow you to send and receive payment-related messages in the ISO 20022 standard.

B. Core banking systems

For financial institutions, core banking systems need to be integrated with ISO 20022 to handle payment transactions, customer data, and other financial messages according to the ISO 20022 messaging standard. This may involve upgrading the systems or implementing adapters to support ISO 20022 messages. If your core banking systems are from a payments application service provider, be sure to verify that they have active ISO 20022 initiatives. Examples of these providers are Fiserv, FIS, Jack Henry & Associates and ACI.

C. Enterprise Resource Planning (ERP) systems

If your organization uses ERP systems to manage financial data, you’ll need to ensure they can process and generate ISO 20022-compliant messages as part of your ISO 20022 implementation efforts. This ISO 20022 integration is vital for seamless data exchange between your ERP and other systems, such as payment platforms and treasury management systems.

D. Treasury Management Systems (TMS)

For businesses managing cash and treasury operations, integrating your TMS with ISO 20022 messaging formats is crucial. This example of ISO 20022 integration enables enhanced cash management, liquidity reporting, and improved visibility into financial transactions. Examples of treasury management systems include Kyriba, FIS, TreasuryXpress, GTreasury and ION Treasury.

E. Customer Relationship Management (CRM) systems

Integrating CRM systems with ISO 20022 allows businesses to exchange customer-related information in compliance with the standard. This ISO 20022 integration supports better customer service, accurate data exchange and improved payment processing.

F. Data transformation tools

Data transformation tools help convert data between different formats. To align with ISO 20022, you may need to integrate data transformation tools to convert your existing data formats into the required ISO 20022 message types.

G. Swift

If your organization uses Swift for international financial messaging, you’ll need to integrate Swift with the ISO 20022 standard to ensure smooth and standardized communication with other financial institutions. Integrating Swift with ISO 20022 involves mapping specific message types. There are more than 700 messages in the full portfolio. The most common ISO 20022 message types should be considered throughout the whole process of ISO 20022 integration:

Payments:

Payment Initiation (pain.001): Used to initiate a payment order
Payment Status Report (pain.002): Provides the status of a payment
Bank-to-Customer Debit/Credit Notification (camt.054): Informs the account owner of a debit or credit transaction on their account

Securities:

Securities Settlement Transaction (sese.024): Conveys the settlement details for securities trades
Securities Trade Confirmation (sese.023): Used to confirm the details of a securities trade

Finance:

Letter of Credit (lcamt.700): Conveys the details of a letter of credit transaction
Bank Guarantee (bgcamt.700): Used to communicate details of a bank guarantee

Cash management:

Account Reporting (camt.052): Provides information about the balances and transactions of an account
Bank-to-Customer Account Statement (camt.053): Conveys the detailed account statement to the account owner

Foreign exchange:

Foreign Exchange Confirmation (fxcamt.900): Used to confirm the details of a foreign exchange transaction
Foreign Exchange Order (fxcamt.900): Conveys an order for a foreign exchange transaction

Trade services:

Trade Transaction Status (tradmx.007): Provides status information for a trade transaction
Trade Services Transaction Status (tradmx.007): Conveys the status of a trade services transaction

Please note that these are the most common ISO 20022 message types. The Swift message types you currently use should be cross referenced to the corresponding ISO 20022 message types that best align with your business needs. You don’t have to limit your organization to current message types. Take this opportunity to research new types that have relevance to your business as you envision it 24–36 months into the future.

H. Application Programming Interface (API) integration

APIs facilitate seamless communication between different systems and applications. Implementing ISO 20022-compliant APIs can simplify integration efforts and support real-time data exchange.

I. Reporting and analytics systems

Integrate your reporting and analytics systems with ISO 20022 to extract valuable insights from the enriched data provided by the standard. This integration can help with compliance reporting, risk management and decision-making processes.

J. Data validation and compliance tools

To ensure data accuracy and compliance, consider integrating data validation and compliance tools that can validate ISO 20022 messages and flag any inconsistencies or errors.

K. Fraud and AML application

Consider integrating your fraud and/or AML application early in your overall payment process.

Keep in mind that the specific integrations required will depend on your organization’s existing technology landscape and business processes. It’s essential to work closely with your IT team, vendors, and solution providers to plan and execute the necessary integrations effectively. Regular testing and validation are crucial to ensure a successful transition to ISO 20022 compliance.

2025 milestones: Testing your ISO 20022 implementation

Testing and validation

In this final stretch of the ISO 20022 countdown, it is important to define a test program that runs throughout and beyond your migration, and that ensures your ecosystem will be ready. It should include comprehensive testing and validation of the integrated systems and processes to ensure smooth functionality and compliance with the ISO 20022 standard. This includes:

Rigorous testing of integrated platforms and systems to verify accurate data transmission and seamless operations
Validation of ISO 20022 message formats and their alignment with your organization’s business requirements
Thorough testing of end-to-end payment and messaging workflows to identify and resolve any issues

Compliance readiness assessment

Conduct compliance readiness assessments throughout the migration to ensure all systems, processes, and personnel are fully prepared for the transition to ISO 20022. These assessments involve:

Reviewing the entire integration landscape to identify any gaps or potential bottlenecks
Verifying that all integrated systems and platforms align with the ISO 20022 standard and are capable of seamless data exchange
Assessing staff proficiency in handling ISO 20022 messages and workflows

Parallel runs and transition

Execute parallel runs, where both the existing systems and the newly integrated ISO 20022 systems operate simultaneously to ensure accuracy and reliability. This includes:

Simulating real-world scenarios to validate the performance of the integrated systems and identify any discrepancies
Gradually transitioning processes from the old systems to the ISO 20022-compliant systems, ensuring minimal disruption to operations
Continuously monitoring the parallel run to address any issues and fine-tune the integrated systems

Continuous training and knowledge transfer

The ISO 20022 countdown completing the migration may end in 2025, but the process continues. Throughout your migration to ISO 20022 and beyond, your team and your business partners will need to be trained on how to apply ISO 20022 within your existing and new business processes.

Remember that a comprehensive and well-executed implementation plan, supported by collaboration among various teams, is key to successfully achieving ISO 20022 compliance. These milestones are suggestions based on our experience, expertise, and guidelines provided by Swift.

Figure 1: Process of ISO 20022 migration throughout the ISO 20022 countdown

How SEEBURGER helps

SEEBURGER is your partner throughout the whole ISO 20022 countdown, from developing an ISO 20022 migration plan to ISO 20022 implementation to testing and validation.

The SEEBURGER Payments Integration Hub is a secure and scalable single platform with modular and agilely configurable components that allow you to be ISO 20022-ready rapidly and at a low cost. It handles data conversions, compliance and back-office integration, leading to better automatic reconciliation and accounts payable and receivable automation, as well as faster straight-through-processing. Ready-made application connectors map and translate different payments formats to ISO 20022 without disruptions to your workflow, systems and applications. This will enable better cash management and visibility.

Do you want to know more about ISO 20022? Check out the content below. Especially our joint survey with Celent, a leading research and advisory firm focused on technology for financial institutions globally, gives you more insights into the ISO 20022 readiness of both banks and corporates.

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Webcasts on demand:

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