Financial messaging network Swift is gaining traction among US corporate treasuries according to a survey conducted by Financial Insights, in a move that presages a subtle shift in the balance of power between banks and their corporate clients.
Financial Insights surveyed 230 corporates primarily doing business in North America and found half of the sample are either interested, evaluating, or already using the Swift for corporates (Score) offering.
While the financial crisis has had a catalysing effect, Financial Insights says Swift has also been more effective at marketing its capabilities to corporates.
The big breakthrough for the bank-owned messaging network has been the development of the Alliance Lite interface, which has removed the "Swift is too expensive barrier". Swift's Alliance Lite offering breaks new ground by enabling Internet-based access to the network for a low monthly fee.
Financial Insights' analyst Jeanne Capachin says that the Lite interface is in tune with the current corporate mood for more open standards and bank-agnostic connectivity.
Banks too are responding to the shift, she says. "Tier 1 banks are moving away from blocking standardisation efforts and the leading banks are working with their clients to increase adoption and develop new solutions," says Capachin. "We will likely also see less usage of bank payments initiation and cash management applications with the biggest clients, as they move to more straight-through processing via their ERPs, treasury management systems, and communication gateways."
Looking ahead, Swift is working closely with Score participants to develop new offers for corporates and to solve some of the nagging problems that a fragmented group of financial institutions cannot. On the table are things such as bank account administration and federated identity management.
"Swift has a powerful position and the next big addressable market for them is corporates," notes Capachin. "Enhancing offerings and acting as a broker between corporates and their banks will shift the balance of power more in favour of corporates."