New SWIFT Tool Offers Front Row View of Post-Trade Settlement Journey

A new capability being piloted by SWIFT tackles the lack of visibility in post-trade processing while also helping prevent settlement fails.

SWIFT Securities View addresses one of the biggest challenges in the securities industry, according to a Wednesday (Sept. 28) press release. The new service is in the pilot stage and will be released for wide adoption next year.

Once a security transaction is placed, multiple intermediaries make it impossible to track all of the steps in the processing lifecycle. That lack of visibility increases the risk of the security ending up in the wrong place, which leads to settlement fails that add operational costs and regulatory penalties, according to the release.

See also: SWIFT Testing Use of Blockchain for its Corporate Communications

“SWIFT Securities View does more than just empower our customers to identify and rectify discrepancies in settlement transactions; it sets the blueprint and foundation for a new industry standard to radically transform the industry, just as SWIFT gpi continues to do for cross-border payments,” said Vikesh Patel, head of securities strategy at SWIFT.

“Our early pilot results show this potential and further strengthen our mission of making transactions instant and frictionless, across all industries,” Patel added.

SWIFT Securities View gives market participants a front-row seat to see each step in the settlement journey so they can identify trades at risk of failing and spot discrepancies between buy-sell instructions. Having a clear view also enables market participants to take preemptive action, the release noted.

Read more: SWIFT Launches AI Tool to Predict Cross-Border Payment Problems

Participants in the pilot included ABN Amro Clearing Bank, BlackRock, BNP Paribas, BNY Mellon, Citi (Securities Services and Global Markets), Credit Suisse, Euroclear, Euronext, HSBC, J.P.Morgan, Northern Trust, Optiver, Pershing, SEB and others.

By using an ISO-standard unique transaction identifier (UTI), messages related to the same securities flow are linked, which allows for automated tracking of both sides of the transaction by everyone involved, “similar to the tracking of a package via a postal delivery service.”

SWIFT is pushing for the universal adoption of a UTI to achieve standardized data use across the post-trade lifecycle.

“The UTI adoption by the industry could facilitate earlier matching which is key to timely settlement, especially with trade settlement cycles shortening across the Globe,” said Steve Wager, executive manager, head of direct markets management at BNY Mellon.

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