SWIFT recently announced the launch of its new Payment Pre-validation service, saying it’s a core building block in its strategy to drive instant and frictionless transactions worldwide.
Most cross-border payments are processed without issue, but one of the leading causes for those that fail or lose time is incorrect beneficiary information — from misspelled names to transposed account numbers, the cooperative noted.
As these issues are detected late in the process, they can be among the most time-consuming and costly to resolve, it added .
The new Payment Pre-validation service tackles this problem by allowing a sending bank to confirm account details, via an API, with the receiving bank from the very beginning of the process so that any data or account problems are identified right up front, SWIFT pointed out.
This check is similar to what already occurs in some domestic markets except the SWIFT service will go much further — solving the issue for up to 11,000 institutions and 4 billion accounts in 200 countries, SWIFT added.
According to the cooperative, over the coming months it will offer additional checks based on reference data encompassing millions of transactions to further predict, at the point of initiation, when a transaction may potentially run into friction points along the way.
The cooperative is transforming its platform to enable instant and frictionless payments anywhere in the world over the next two years and beyond, aiming to significantly improve end-to-end efficiency, reduce total costs, and to create services that equip financial institutions to capture growth and create new, differentiated customer experiences, SWIFT added.
Payment Pre-validation is one of many such services to come that will support the first platform release in November 2022, the cooperative noted.