SWIFT has entered the remittances market, in a move that will help incumbent banks compete more effectively against fintechs that specialize in cheap, fast, and transparent cross-border payments for individuals and small businesses.
Traditionally a messaging service for high-value correspondent banking payments and securities transactions, the group has now launched SWIFT Go, a service for consumers and small businesses to send low-value payments across borders directly from their bank accounts.
Seven global banks are already live: BBVA, Bank of New York Mellon, DNB, Alibaba’s MYBank, Sberbank, Société Générale, and UniCredit. They can use SWIFT Go to offer a seamless payments experience for low-value transactions. These include activities from SMEs paying overseas suppliers to consumers sending money to their families internationally.
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“Our new service will allow banks to compete effectively in one of the fastest growing segments of the payments market, delivering a seamless experience for their customers,” said Stephen Gilderdale, chief product officer at SWIFT.
By leveraging SWIFT’s network, notably the rails of SWIFT gpi – a program designed to make SWIFT-enabled transactions more automated and transparent – banks can take advantage of existing service level agreements and pre-validation of data. That makes SWIFT Go fast, transparent, and low-cost for the roughly 11,000 financial institutions using SWIFT messaging services.
This gives banks a stronger defense against the encroachment of fintechs that have made cheap and near-instant cross-border payments their hallmark.
“SWIFT gpi has become the benchmark for high-value cross-border transactions and we are confident that SWIFT Go will be equally as transformative for SME payments,” said Feng Liang, deputy CEO at MYBank.