Alan Marquard, executive vice president, applications at Mastercard commented on their current progress towards 2027 goals as reported by FSB in their second annual assessment in a session on G20 targets at Sibos in Beijing: “we're four years in the journey to 2027, and we're nowhere near there. I find that completely unsurprising. The metrics were set up as quantitative metrics, but set at a global level without clarity on who was responsible for achieving them.”
The session, titled ‘Collaborating to achieve the G20’s goals’ featured speakers Philippe Depasse, senior product owner, international payments at Commonwealth Bank of Australia; Jun Jiang, deputy division head at ICBC; Marquard; Jan Paul Van Pul, senior payments advisor at ING; and was moderated by Tony Wood, partner at Deloitte.
Marquard continued that there needs to be more exact metrics on commercial payments, as the pain points are very specific to flows.
He then highlighted the need for public-private partnerships and collaboration: “I think we've made great progress in the last four years, but I'm going to be contentious and say, I think it's largely down to fintechs coming in, banks trying to fight back, and a general sense of competition against a backdrop of the roadmap, which sets a sort of overall expectation do something about this. I think the roadmap has been really helpful, but in terms of the actual target metrics, a lot more could be done.”
Van Pul agreed with Marquard on the need for more collaborative public-private partnerships. He said that the G20 criteria on transparency, speed, accessibility is critical for all commercial businesses in international payments. He continued that Swift APIs marked a significant change in the international payments ecosystem.
“The FSB has assigned the target for 75% of cross border payments to be with the end-beneficiary within an hour, by 2027. According to Swift, about 50% of the payments over Swift GPI are now reaching to the beneficiaries account within five minutes. The cross-border industry has achieved a significant progress toward achieving the G20 target, especially in improving transparency and increasing the speed,” Jiang explained.
Jiang stated that the G20 targets can only be achieved through collaboration and full implementation of industry-wide standards, such as Swift GPI. She added that ICBC is also using GPI trackers and operating according to this standard, where payments can be tracked through the bank’s apps and site. She continued that migrating to ISO 20022 is a key step to in making payments frictionless.
Van Pul pointed out what has been successful so far: “I am a bank, but I think it's good that new entrants came in, because it makes the banks proactively sharp. It's the Revoluts, the Wises, the PayPals, but makes you learn learns to be really proactive towards your clients, and how to improve.”
On new developments, he mentions the growth of digital assets in Southeast Asia and their evolution of instant cross-border payments with BIS Nexus.
Depasse corroborated with the others on the importance of collaboration and transparency in achieving G20 targets, and he furthered that there is a need for consistent implementation and business intelligence tools to track payments and align with the objectives.
He said that it is important for financial institutions to be able to track their payments and initiatives: “The Commonwealth Bank has piloted a series of G20 dashboards within the GPI Observer Insights, the business intelligence suite of products and services, and this is where it becomes interesting, because it means I can go to that tool, extract exactly where I am and understand from a GPI tracker perspective the key insights I need, and report to my management to see if I'm aligned with G20 targets.”
When touching on payments collaboration in their respective markets, Marquard specified that fintechs in Australia are going beyond the minimum requirements for AML and compliance, and therefore the partnership between fintech and financial institutions goes more smoothly, thanks to due diligence during the onboarding process.
Jiang said that in China, fintechs and banks learn from each other – fintechs are more scalable and dynamic, banks have a stronger foundation and concentrate on compliance risks, and both can support one another when it comes to innovation.
When concluding the panel, all the panelists agreed that collaboration and industry-wide standardisation are vital to achieve G20 targets moving forward.