ISO20022 for API & New Technologies
11 July 2019
Kenneth Leung, Standards
Asia Pacific, SWIFT
Agenda
1. Background
2. Challenges on API Framework
3. Challenges on API Payload Specification
4. ISO 20022 – the Business Standard for Financial Service Industry
5. ISO 20022 – the Building Block for API and New Technologies
6. Leveraging SWIFT’s Core Competencies
7. SWIFT’s API Whitepaper
8. Q&A
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API Commuting
Shopping
Dining
BankingMusic
Ticketing
Connecting
Apps
Connecting
People
Connecting
Businesses
Is Everywhere
REST
REST
XML-RPC
SOAP
Challenges on API Framework
Easy to Develop | Low CostUniversal ReachTime-to-market
OAS
OAuth
FB Msgr
Like communication
many ways of Instant
Messenger Tools…
SnapchatWhatsapp
Telegram
Many API Technologies
Support by
standards of
Choice of Open Banking / FI
Easy switch between service providers Aggregate data from multiple sources
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Challenges on API Payload Specification
You need to have a common understanding of
Like communication in different human languages
the semantics, grammar, sentence
structure….etc
To deliver the message clearly & accurately
Simplicity & Agility of REST API
Fragmentation becomes inevitable
Inconsistencies in Business Specifications
Negate key promises of API
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Challenges on API Payload Specification
Data Convention -
Translation
Data format - Loss /
Truncation
Semantics/Meaning -
MisinterpretationVS
VS
VS
Processing Date Settlement Date
Purpose Code (for Recipient) Category Purpose (for bank process)
BAI Transaction code Proprietary code
Max35Text Reference Max12Text Reference
2 Lines of Details 4 Lines of Details
Structured Address Unstructured Address
Challenges /
Risks
API Spec
Flavor 1
API Spec
Flavor 2
Aggregator-C
API1
API2
Provider-A
Provider-B
Aggregator Model
API1 API2
Consumer-X Provider-Y
(Consumer of API2)Provider-Z
Propagator Model
Challenges on API Payload Specification
Problem exacerbates when API meets traditional messages
Challenges on API Payload Specification
Or when different new technologies used
for transporting the same data
“Whatever the technology, in multi-party networked business,
participants need to agree on the meaning and content
of shared data, business processes, roles and responsibilities.
This is the domain of business standards”
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ISO 20022 – Business Standard for Financial Services
Platform & Technology Agnostic
Simplifies
API integration
into existing process & systems
Machine-processable
repository of content
Was conceived to harmonise
fragmented financial
messaging standards
landscape Methodology
to standardize
financial transaction
Open and
global standard
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What is ISO 20022?
Single standardisation approach (methodology, process, repository)
to be used by all financial standards initiatives
• Defines business meaning of financial concepts, e.g., ‘Credit Transfer’
Business / Conceptual
• Defines e.g. credit transfer messages, to execute the business process
Logical
• Defines physical syntax, e.g. XML, JSON,…etc
Physical
• Business models
• Data dictionary
• Catalogue of messages
Recipe to create financial standards Body of content
Not only for XML
Concept
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ISO 20022 – the Building Block for API and New Technologies
All institutions have
their own sets of data
objects
XML
…are then used to define
APIs in a specific syntax JSON
…and groups them into ‘syntax-neutral’
data models, which...
ISO standardizes common
data objects…
Define the API Resources
Selectively reuse existing
ISO 20022 components &
elements => Custom
resource componentsNo need to use the entire
structure of the source component
=> No deep nesting like in
message design
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Define the API request/responses based on the Resources
Pick and choose the
elements from the
Resources to compose
your API calls
No need to reuse the entire
structure of the Resource
=> No deep nesting like in
message designOnly use the elements you
need for the API call
=> Custom made calls
Add technical
elements where
appropriate
Leveraging SWIFTs core competencies
Foster standardization at
industry level reusing the
ISO20022 data dictionary
Offer API connectivity and
developer support for more
value added services
Collaborate with the community
to explore use cases and
expose a global community API
catalogue on the platform
SWIFT APIs enable financial institutions and corporate customers to expose or consume financial
services in a trusted environment using standardised transactions according to the ISO 20022 model.
Simplification of access
to SWIFT Shared
Services
Customer API exposureStandardization of API
specifications
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Standards initiative related to adjacent servicesShared services
Core services (gpi) Standards initiative related to Core services
SWIFT and Community APIs
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KYC API
rolling-out
Sanctions
Screening API
current
KYC-SA API
future
SWFTRef API
current
Tracker API v1
current
g4C API
rolling-out
Tracker API v2
rolling-out
gFIT API
future
PayLater API
GTV
tentative
Securities
(Status)
tentative
Bank 2 Corporate
Liquidity
tentative
Beneficiary
Account
Validation
tentative
PSD2
tentative
NAV Calculation
tentative
Complex
Instruments
tentative
current
Pay Later API - Press Release – 16 Jan 2019
• Small strategic working group to publish V1.0 of the standard
• Rapidly scalable across large number of banks and merchants globally
• Use of ISO20022 component
• Ensure compatible with clearing/settlement
of instant payments
• Simplify data integration for both banks and
merchants
Merchants BanksConsumers
Common API spec
• for banks to implement
• for merchants to connectConfidentiality: RESTRICTED. Do not disclose to third parties without SWIFT's prior written consent
SWIFT White Paper on API
Delivering a global platform for financial services API economy• Avoid re-invent the wheel
• Needs a single, shared business standardisation methodology and governance
strategy
• Re-use ISO20022 business definitions and data models
• Ensure end-to-end consistency in business processes (API & Legacy)
• Look beyond immediate need to comply with regulation or for tactical solution
Two key aspects to ISO20022:
• A methodology: a “recipe” to standardise financial transactions.
• A machine-processible repository of content:
• the definitions of messages,
• business concepts,
• processes and everything else required to describe those transactions
• ISO20022 API shares the same business
semantics and data dictionary as a
related ISO20022 message.
• Greatly simplifies the task of integrating
the API to existing financial systems and
processes.
[Download here]: https://www.swift.com/news-events/news/delivering-a-global-platform-for-the-financial-services-api-economy
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Thank You