SWIFT Looks to Web Services

Looking to drive the adoption of Web services as a mechanism to extend
industry integration to financial institutions of all sizes, the banking
industry’s wire transfer backbone, the Society for Worldwide Interbank
Financial Telecommunications (SWIFT) today signed an alliance agreement with
Web service integration firm IONA .

SWIFT is a community of financial institutions that provides a de facto
messaging standard and value added network (VAN) for payment processing,
treasury, securities and trade services between banks, brokers, market
utilities and service providers to reduce costs, improve automation and
manage risk.

As an alliance partner, IONA will work with SWIFT not only to submit, adopt
and promote messaging standard proposals and technical guidelines, but also
to extend industry integration to financial institutions of all sizes,
including the growing number of smaller buy-side participants, such as
investment managers and hedge funds.

“Using a simpler and lower cost mechanism, like Web services, to extend
SWIFT integration and leverage new standards, like ISO-15022, especially for
buy-side participants, is really quite innovative and practical,” said Linda
Bookheim, Partner Solutions Business Manager at SWIFT.

According to Gary Maier, Managing Director of Global Financial Services at
IONA, In most cases the benefits of SWIFT have only been available to the
largest of financial institutions because, at least in part, of the inherent
complexity and cost of maintaining cryptic EDI messages over dedicated, and
expensive, T1 lines.

“In order to achieve the global processing efficiencies and cost savings of
true, industry-wide, Straight-Through Processing, access to SWIFT and other
related industry services must be made available to all participants,” said
Maier. “This can only be accomplished, however, by extending integration
from the largest of mega money-center banks to the smallest of hedge funds.”

As a member of the SWIFT alliance, IONA is advocating the use of Web
services, in conjunction with new industry XML standards, like ISO-15022, to
ease this level of integration.

ISO 15022 replaces the previous standards for electronic messages exchanged
between securities industry players, ISO 7775 and ISO 11521.

ISO 15022 sets the principles necessary to provide the different communities
of users with the tools to design message types to support their specific
information flows, including a set of syntax and message design rules, a
dictionary of data fields and a catalogue for present and future messages
built by the industry.

The full-year implementation period to convert fully to the new SWIFT
standard, ISO 15022, is well underway. On November 17, 2002, SWIFT will
permanently remove 7775 messages.

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