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ISO 20022: Can Treasury Build the Business Case?

  • By Magnus Carlsson
  • Published: 4/21/2016
PHOENIX -- AFP was represented in two sessions at this week’s NACHA Payments conference. Together with SWIFT and Microsoft, AFP provided a corporate perspective on the challenges around implementing the ISO 20022 payments standard. AFP also presented the results of its 2016 Payments Fraud and Control Survey, underwritten by J.P. Morgan.

Corporate treasurers are finding it particularly difficult to build a business case for investing in new payments infrastructure. Depending on the current payments system and processes set up, the cost for implementing a new standard can be significant. Therefore, it is important to understand that even if a new standard can provide greater efficiency and cost savings, a wait-and-see approach may still be the most prudent action for a corporate.

Another challenge is the sustainability of the standard. If a corporate decides to make the investments to comply with the new standard, they need to be assured the underlying standard will not change to such a large extent that additional investments will be necessary. With the number of versions of the standard being developed, this could prove to be a major problem. It may also be a good idea to reflect on the problems that the SEPA implementation faced in eurozone.

In the session on the fraud survey, AFP was accompanied by Peter Karegeannes from the U.S. Secret Service, who provided excellent insights on how his agency works to combat fraud. The most important prevention method for business email compromise (BEC) fraud is to put in place internal procedures that prevent the possibility of payment generation based on instructions from other than approved sources. He also recommends dual authentication, and in case of any uncertainty, having a procedure to always double check with a simple phone call.

Magnus Carlsson is manager of treasury and payments for AFP.
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