The SWIFT platform can rival new-age rivals, says CEO Kiran Shetty

 

The platform enables financial institutions to send and receive information about financial transactions in a secure environment.

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is a network that enables financial institutions to send and receive information about financial transactions in a secure environment. Banks send over $327 billion daily via the network’s Global Payments Initiative. It is now foraying into low-value payments, and has settled the integration issues with banks’ core banking that the Punjab National Bank fraud in 2017 threw up. KIRAN SHETTY, chief executive officer and regional head of SWIFT (India) and South Asia, spoke to Raghu Mohan. Edited excerpts:

What is your pilot-project on low-value payments about?

We have been a technology provider to banks over four decades. We call ourselves the first fin-tech company of the world, because we digitised the entire correspondent banking. The IT rails in this business were real-time, but there were delays and frictions. The Global Payments Initiative is a tracker on top of this rail. It offers full visibility to where a payment was at any point in time and on the charges being deducted by each counterparty bank in this journey. We have over 4,000 institutions that are GPI-enabled. Over 92 per cent of the payments happen in less than 24 hours, and 40 per cent of them within 30 minutes. Every day, banks send over $327 billion via GPI. In 2019 that amounted to $77 trillion, and in 2018, it was $40 trillion.

You offer a platform to banks and the pricing of the transaction on it is decided by them, which becomes transparent to everybody on SWIFT. Is this how it works?

That’s correct. The pricing is decided by banks. We want to become a transaction management platform. We will take away the cost of know-your-customer compliance (KYC). We’ll make the data far richer. It will be a very interesting journey for banks to gain market share. And I think banks rightfully own these transactions, because they emanate from their clients. They are able to provide the same quality of service that somebody else may have provided.

Who is the “somebody else” you are referring to?

Could be anybody, could be fintechs. Basically, anybody other than banks that are into the cross-border transactional business. Like foreign exchange houses and remittance providers.