Payment of the future – How SEPA Instant Payments and SWIFT gpi revolutionize the payments market and make life easier for corporate customers

Interview by Alexandra Jocham, RBI |

Sabine Zucker

Sabine Zucker, Head of Trade Finance and Transaction Banking at RBI, explains the payment innovations SEPA Instant Payments (SCTInst) and SWIFT gpi and their benefits for the customers.

 

SEPA Instant Payments (SCTInst) and SWIFT gpi are two major Product Innovations delivering real time benefits & cost savings for clients, could you please elaborate on this?

The new SCTInst Service is a pan-European initiative and a milestone in payments business. It makes instructing and receiving payments 24/7 possible within ten seconds. Liquidity is available on the beneficiary’s side immediately. The optimization of cash usage is one of the great advantages. With Instant Payments it is possible to reach banks in the whole SEPA area with an initial maximum transaction amount of EUR 15,000. This transaction amount will be increased to EUR 100,000 by 1 July 2020.

RBI started with SCTInst on day one together with the entire Raiffeisen Banking Group in Austria. After having joined EBA RT1 (the European Banking Association’s real-time payment system) successfully, we also became a participant of TIPS (TARGET Instant Payment Settlement) in April 2019 and are now a participant of the two most important cross border Instant Payment Infrastructures in Europe, which brings positive effects on the expected number of SCTInst transactions.

Now that SCTInst has been launched, what are the next steps?

We are constantly developing new features for Instant Payments, e.g. the possibility for corporate customers to send files which are then forwarded as individual Instant Payments. Another working topic is the definition of a payment confirmation message for the beneficiary. Especially corporate customers want to be informed in real time about incoming payments in order to ship goods faster or grant access to online products to their customers immediately.

Instant Payments will be offered to both, Retail Customers and Corporates of RBG Austria and are currently implemented step by step in all customer front-end systems.
The steady upward trend in instant payment transactions demonstrates the importance of real time payments.

What is SWIFT gpi?

SWIFT‘s “global payments innovation (gpi)“ indicates the dawn of a new era in international payments, making same-day use of funds, increased transparency and predictability regarding end-to-end payment tracking the new standard.

More than 830 financial institutions worldwide are live today with gpi customer credit transfers, covering approximately 150 currencies. As more and more banks are joining this standard and additional currencies are expected to be available, the appetite for SWIFT gpi among corporates will be increasing further.

RBI’s intention was to join SWIFT gpi as early as possible as we saw the need to drive innovation also in cross-border business-to-business payments. After the instant payment scheme for SEPA Payments, we also wanted to revolutionize the international payments area.

I am very proud to say that RBI was the first bank in Austria to go live with SWIFT gpi for incoming and outgoing customer payments as well as clearing payments, all in EUR and USD.

What is the benefit for corporate customers? 

The great advantage for corporate customers is that no adaptions need to be done on their side. When they register for the SWIFT gpi service, we check all of their outgoing cross-border payments in the registered currencies, whether they can be executed as gpi payments with same-day value.

Incoming gpi payments in EUR and USD will be executed real-time and with same day value. At the same time the SWIFT Payment Tracker is updated by us and the final credit is confirmed.

Is payment tracking possible?

As a unique end-to-end transaction reference number (UETR) is added to the payment and thanks to the obligation of each gpi bank to provide status of the payment and information regarding deducts to the SWIFT payment tracker, an end-to-end payment tracking is possible for gpi banks.

The tracking functionality is of interest not only for banks, but also for our  corporate customers. Therefore, we will soon go live with the RBI Payment Tracker, which will enable all registered corporate customers to directly access the status of their gpi payments in the registered currencies.

For the time being, RBI has installed an email notification service, informing its corporate customers automatically about their incoming and outgoing gpi payments. The email contains payment details, but also the respective UETR, which can be used for a quicker and more efficient payment inquiry.

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