Every business’ sustainability depends on the reliable and secure exchange of money. In this case, financial institutions stand as the gatekeepers as being responsible for providing transparency and security, especially during international transactions. This mission brings financial institutions a great challenge and a huge risk.
In order to reduce the risk by accurately and confidently send and receive information between financial institutions, an international interbank telecommunication service is established. Thus, by using a standardised messaging service, transactions between financial institutions are being recorded and all the recorded details of the money transfer can be provided to ensure security.
The Evolution of Financial Messaging
The very first international interbank telecommunication service, Telex-Messages, was built in the 1930s. This service was manual and not very secure.
Thus, in 1973, 239 banks from 15 different countries worked together to create a proprietary system and founded the Society for Worldwide Interbank Financial Telecommunication (SWIFT). With SWIFT, they created common standards for the transmission of financial information through a shared global data processing and communication link.
The first message was sent in 1977 via SWIFT network. After the first message, with an ascending graph, it reached 518 customers and 10 million messages in just a year. The US joined SWIFT in 1979 and in the following year, Asian countries were also connected to the network.
In 1987, SWIFT members were demanding to expand the network by adding central depositories, exchanges and broker-dealers. This was a massive exchange on the range of messages in the network.
Today, the globally-owned cooperative is connected to more than 200 countries and connected to over 11,000 institutions around the world. The American continent accounts for only 19% and the Asia Pacific region for 12% of global traffic. 69% of SWIFT traffic concerns Europe, the Middle East and Africa.
Nearly 43% of SWIFT traffic is for security transactions, 50% still for payment-based messages, and the remaining traffic flows to treasury transactions.
Choosing The Best SWIFT Provider
For financial organizations, banks and software companies the financial messaging service SWIFT is the most accurate solution to ensure safety and transparency for their clients. To be a member of the SWIFT network and to use financial messaging, every financial institution needs to work with a SWIFT solution provider.
To decide on the best SWIFT solution provider, there are some basic issues financial institutions can inspect. Let’s have a look at these issues together:
Ask For References
Check the existing and previous clients of a provider is one of the most essential methods to evaluate. It’s relevant to see if the provider is willing to refer you to its clients for a reference.
Question Their Expertise
It’s important to learn for how long the potential SWIFT solution provider has been working with SWIFT for their clients. Finding a provider with long term expertise would be safer because SWIFT is integrated within the client’s internal software.
Learn If They Are SWIFT Library Experts
There are two types of SWIFT providers, third-party resellers or SWIFT library experts, and their expertise are extremely different from each other. Selecting library experts would be safer for financial institutions as third-party resellers won’t be able to provide the need for maintenance, customisation and support.
Evaluate Their Responsiveness
Supporting all clients equally and being responsive in the need of any support is one of the most important values for a SWIFT provider. Ensuring if the support will continue to be provided by the original team or a less experienced support team will be taking over would be efficient.
Question Special Domain Experience
The SWIFT provider should be experienced enough to have a deep understanding of the SWIFT rule book and error codes. Because they are extremely complex for solution providers without the specialist domain experience.
With its main promise of “Be Fast. Be Transparent. Be Compliant.” Fineksus is the one and only regional partner of SWIFT in the Middle East and Turkey. Fineksus is one of the most experienced SWIFT providers with its wide range of software solution offers, training, facility management and data processing services.
Fineksus positions itself as a business partner and provides new product development support for its clients to maximise their benefit.
If you represent a bank, software company or a financial institution with the aim to join SWIFT, you can check our solutions or just contact us and we would be delighted to share our expertise and answer any of your further concerns.