WINTER 2010 VOLUME 2, ISSUE 2 ISO 20022 Newsletter IN THIS EDITION Dear RMG Members: Letter fom Gerard Hartsink ..................................................1 ince the 2008 Helsinki meeting, the RMG pursued a Highlights From “Meet the Tokyo Market” May 2010 ............2 S“Meet the Market” program where RMG members ISO 20022 Securities Standards: Asian Perspective ..............3 carved out time for host countries to invite local financial institutions to attend briefings on the ISO 20022 standard, Technical Support Group Prepares as well as provide RMG attendees with information about (TSG) 20022 Migration Paper ............................................5 their financial activities. This exchange has proven a valu- Securities Messaging Standards Development able educational tool where host firms and central bankers in the ASEAN+3 Countries ..................................................6 learn and anticipate what might be needed to implement the ISO A Tale of Two Standards: XBRL and ISO 20022 ..................10 20022 standard, and, in turn, Current Status of ISO 20022 Voting ..................................11 learn about progress being made locally by invitees in their areas of Message Extensions for Supplementary Data…. ..................12 expertise. Internal Governance of the ISO 20022 Registration Our recent meeting in Tokyo Management Group (RMG) ..............................................15 saw more than 100 participants New “For Dummies” Book Explains ISO 20022 ..................16 attending a briefing on the benefits of adopting ISO 20022. Our RMG Building the Single Euro Payments Area Based on group also learned about the new ISO Standards: A further progress report on SEPA................17 developments, state of the busi- The International Payments Framework ness, and what is progressing in Association is Formed ......................................................20 Japan, (see article titled in part ‘Meet the Tokyo Market’) as well as SWIFT’s Role as ISO 20022 Registration Authority ..............22 throughout Asia. This recent expe- Business Application Header Moving rience triggered several articles from members of the RMG Through Payments SEG......................................................25 on practices employed in Southeast Asia that may be includ- ed under ISO 20022. As example Singapore’s standards SEG REPORTS body “SPRING” provides this issue of 20022 Newsletter with Cards & Related Retail Financial Services SEG................26 an account of practices used in the Securities area. In addi- Securities SEG Report ..................................................28 tion, author Amod Dixit has joined the RMG representing Trade Services SEG News ............................................28 Singapore and has volunteered to serve as Vice Convenor of PaySEG Operations for 2010........................................29 the ISO 20022 Securities SEG. (continued on page 3) FOR MORE INFORMATION on ISO 20022, consult the ISO 20022 the five Standards Evaluation Groups (SEGs) and the website at www.iso20022.org and get access to: Technical Support Group (TSG) • Which are the current development projects and their status • Two scripted Powerpoint presentations on the home page to under- • The catalogue of ISO 20022 messages including the latest version stand the ISO 20022 value proposition, the role of the various regis- of ISO 20022 messages and the archive of previous versions. tration bodies, and what has been developed so far • How to become an ISO 20022 ‘submitting organization’ and devel- If you have questions, please send them to the ISO 20022 Registration op new ISO 20022 messages or how to submit updates to existing Authority at [email protected]. messages. • Who is representing your country or organization in each of the ISO Newsletter Prepared by ASC X9, Inc., Annapolis, Maryland USA. For 20022 registration bodies: the Registration Management Group (RMG), comments, questions, or contributions, e-mail [email protected]. Highlights From “Meet the Tokyo Market” May 2010 By Takahito Yamada, RMG Member Delegate for Japan uring the ISO/TC 68 and SC plenaries in Tokyo in May 2010, Dwe had roundtables over three days with domain specific agendas addressing Securities settlement, IT, and Payments. Every evening more than 70 persons of the international delegation from throughout the world, with national mem- bers of Japan’s mirror committees met to share experiences related to the opportunities and challenges surrounding the ISO 20022 standard. Highlights of these deep, meaningful, and lengthy discussions follows: also received insightful PAYMENTS input on better collabora- An update was provided regarding the ISO 20022 implemen- tion with our ISO 20022 tation in Japanese Banks’ Payment Clearing Network (Zengin- XML and XBRL syntaxes net) set to go live in November 2011. We also had opportu- presented by Fujitsu dele- nities to listen to the insightful perspectives of our financial gation XBRL, Japan. services buy-side partners, notably the corporate treasurer of Thus far the most serious Fujitsu who commented on the importance of standards and problems in Asia is the lack the challenges presented by diverse implementations of stan- of the availability of local dards and the proliferation of standards. charactersets in ISO 20022 One of the hallmarks in the retail payment arena in the messages raised by the Tokyo Market is the exciting and rapidly developing area of PMPG (Payment Market mobile payments on the high-profiled NFC (Near Field Practice Group) member, Communication) architectures. We learned about the future which was followed by direction of such retail payments presented by Sony heading extended discussions on the the NFC Forum, together with the backing of new legal infra- complex and varied topics structures i.e., the Payment Services Act just enacted a few in the TC68 plenary where a weeks ago in Japan presented by NTT Data. study group was formed to further develop the issue. SECURITIES SETTLEMENT We received updates of an ISO 20022 securities implemen- THANK YOU AGAIN tation scheduled in 2014 by JASDEC (Japan Securities The meetings closed with Depository Center, Inc.), along with an insightful analysis appreciation stated by all related to efforts of ADB (Asian Development Bank) to to one another, but most achieve Giovannini-equivalent message standardization in particularly to ISO/TC 68 the Asian bond markets, accompanied by a needs analysis for Japan as our successful and standardization in the securities market space thus far highly most gracious host! fragmented among the Asian countries, as reported by ADB. On behalf of all the national members in Japan, INFORMATION TECHNOLOGY I would like to express our Lead architects from Nihon Unitec and Hitachi presented on gratitude for your kind atten- the exciting challenges and potential of XML messaging from tion amid the jet lag and an the perspective of the non-technical business person. We ambitious agenda. G ISO 20022 Newsletter Winter 2010 2 ISO 20022 Securities Standards: Asian Perspective By Amod Dixit, Director, Transaction Banking, Standard Chartered Bank (Vice Convenor of ISO 20022 Securities SEG) sia is undergoing securities industrial a time when the U.S. and European markets Arevolution. Asian countries are diversi- are slowing down. fied from each other in terms of demo- But growth has exacted its price, in the form graphic, language, economy & political cli- of unprecedented shortages of skilled securities mate and in varying stages of economic personnel; operating cost is going up, at a time development and reforms. Asian markets where margins are shrinking in other parts of are at different stages of their evolution. At the world as markets slow down. No wonder the one end of the spectrum you have a the need for higher levels of market automation nascent market like Vietnam and other end has become a burning issue in the region. of the spectrum you have a mature and There are some obvious opportunities open financial centers such as HK, SG, JP & where higher levels of automation can Aus. Trading deregulation, economic increase efficiency and reduce costs. One is growth, activity in the local funds market, and the rapid client interfaces. Another is pre-matching engines. The third is expansion of wealth management and private banking serv- the need for improvement to core settlement processes and ices have seen securities trading volumes grow at unprece- fourth is corporate actions management. The need for improve- dented rates over the past three years. We have also seen ments in these areas goes beyond immediate demands. arrival of dark pools into Asia. Foreign investors have started Without substantial improvements to the standards infrastruc- exploring their presence in Asia significantly in the last two ture in Asia, local markets will be unable to support the sub- to three years, attracted by the local market opportunities at stantial growth in transaction (continued on next page) Letter From Gerard Hartsink (continued from page 1) Members of the RMG Meeting in Tokyo. Education about the implementation of ISO 20022 reached the newsletter. It is now recognized as a very successful a significant milestone with the publication of “ISO 20022 for mode of keeping in touch. All worked hard to make sure we Dummies”, a new addition to the popular Dummies series cre- are all informed about trends and programs undertaken by ated with the assistance of Registration Authority SWIFT. The RMG members that