/payments

News and resources on payments systems, innovations and initiatives worldwide.

Swift connects instant payment systems to bring 24/7 processing across borders

Swift has connected domestic payment schemes across Europe to provide full transparency and end-to-end tracking for instant cross-border transfers destined for the EU.

6 comments

Swift connects instant payment systems to bring 24/7 processing across borders

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

The European Payment Council’s One-Leg-Out Instant Credit Transfer scheme (OCT Inst), which went live this week, enables payments to and from Europe to be processed 24 hours a day, seven days a week.

The go-live follows on from a successful proof of concept earlier this year in which Swift collaborated with Iberpay, the European payment system; Spanish banks BBVA, CaixaBank and Santander; and commercial banks from Australasia (ANZ and the National Australia Bank), Brazil (Itaú Unibanco) and the UK (Lloyds Banking Group), with dozens of international payments successfully reaching Spanish accounts within seconds.

OCT Inst is seen by financial institutions as an opportunity to leverage the benefits of domestic instant payment systems globally, while using existing rails.

Marianne Demarchi, chief executive of Swift in Europe, says: “Interoperability is at the heart of everything we are doing at Swift to achieve our strategy of instant and frictionless payments for all, and it will be key to achieving the G20’s goals for cross-border payments. The EPC’s OCT Inst scheme is a positive step for Europe that will enhance the user experience for payers in Europe, but also all around the world.”

She says Swift is closely monitoring other inter-linking intiatives that will connect domestic Confirmation of Payee schemes to tackle fraud.

In September, for instance, Italy's bank-backed digital payments ooperator, announced that it was extending its Confirmation of Payee service (Name Check CBI) to the European level through connection with Payment Pre-validation.

Sponsored [Impact Study] Payment Fraud in 2024: Who is Liable?

Related Company

Comments: (6)

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

Anyone knows how OCTInst is different from SCTInst? 

Malhar K Lead Product Owner at Finastra

Hi Ketharaman - in the SCTInst ,your payer & payee PSPs has to be in EU only where as for OCTInst one of the payer /Payee can be outside of EU. eg. User from UK having a account with HSBC can make a transaction to the payee who's based out in Europe

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

TY @Malhar K. I wondered as much but I don't find that reflected in the text of the article.

If, as you say, OCTInst needs only one of payor or payee to be in EU, then (1) The payment could originate from EU, why does the article only say "destined for EU"? (2) Payor in India can make a payment to payee in USA by doing India-to-EU in Leg 1 and EU-to-USA in Leg 2, viola this becomes a global crossborder payment system, why does article restrict it to EU / Europe by saying "connected domestic payments schemes across Europe"?

Malhar K Lead Product Owner at Finastra

1. Agree ,it can be destined or originated from EU

2. Use case mentioned by you may not settle by SEPAInst and OCTInst is mainly for payments which will settle ( at least one leg) in EU ,this is what I understood. Happy to get different views

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

TY but if, as you say, OCTInst will work if originator is in UK, it means it will settle by SEPAInst. UK is outside EU. Why won't the same happen if originator is in other outside-EU countries like India and USA in my use case?

Is it because SEPAinst covered UK when it was in EU in the past, and continues to cover UK even after Brexit? (Whereas India and USA were never part of EU, so SEPAInst never covered them.)

Malhar K Lead Product Owner at Finastra

The example I used it for UK but it can be applicable for any country but one leg has to be in the EU ( either payee or payer).

 

In your example ,it was meant to be settled at USA hence i mentioned it may not necessarily use OCTInst scheme.

[Webinar] Payment Scams and Fraud: Changing Bank Behaviour and Regulatory FrameworksFinextra Promoted[Webinar] Payment Scams and Fraud: Changing Bank Behaviour and Regulatory Frameworks