The Society for Worldwide Interbank Financial Telecommunication, more commonly known as Swift, is a global, member-owned cooperative and the leading provider of secure financial messaging services.
Founded in 1973, Swift has developed a set of global messaging standards for formatting and transmitting messages related to financial transactions, such as wire transfers, foreign exchange trades and securities transactions. These standards enable banks, broker-dealers, asset managers and other financial institutions around the world to communicate with each other in a standardized way, thereby reducing errors and ensuring that cross-border transactions are processed accurately and efficiently.
Swift also offers an extensive array of solutions and services designed to support global financial messaging, system integrations, market infrastructure, financial crime compliance and more — including the Swift global payments innovation (gpi) initiative.
What is Swift GPI?
The Swift GPI is a payments initiative developed by Swift to facilitate seamless cross-border transactions. When gpi first went live in 2017, it was intended to provide financial institutions and corporations with visibility into the status of cross-border payments, to improve payment processing speeds and to ensure that creditors received the full amount promised to them.
In the years since, Swift has introduced additional services within gpi to solve new business problems — services that include:
Customer Credit Card Transfer (gCCT)
gCCT connects Swift GPI to various real-time payment networks, enabling institutions to process cross-border transactions in real time and settle funds immediately.
Financial Institutions Transfer (gFIT)
Designed for capital markets, this service enables banks and other financial institutions to track and trace incoming and outgoing transactions between institutions to reduce risk and better manage liquidity.
Cover Service (gCOV)
gCOV streamlines the straight-through processing and handling of cover payments within the gCCT framework, reducing liquidity risk and allowing for faster and more transparent cross-border transactions between financial institutions.
gpi for Corporates (g4c)
g4c is a program designed by Swift to help multi-banked automated corporates and financial institutions implement SWIFT GPI within their own payment processes.
Stop & Recall (gSRP)
gSRP utilizes the Swift Tracker platform to provide direct communication and real-time status updates, thereby addressing common challenges associated with stopping and recalling payments due to error or fraud.
Pay and trace
gpi delivers speed, security and transparency by giving corporations an end-to-end view of all payments, including visibility into bank fees charged and FX rates applied to cross-border payments.
Instant International Payments (gInstant)
This service enables financial institutions to connect gpi’s instant payments service with real-time payment networks, allowing for the real-time reconciliation and settlement of cross-border transactions.
Case Resolution (gCase)
gpi’s case resolution service automates all aspects of exception management — including country and currency regulatory obligations and formatting requirements — to easily handle queries between financial institutions and resolve outstanding issues.
Pre-validation
gpi’s up-front account verification service uses application programming interfaces (APIs) and multiple data sources to validate payment details, creating truly frictionless cross-border payment flows.
One of the primary drivers behind the release of Swift GPI — as well as other Swift services, including Swift Go — was the launch of ISO 20022, a global messaging standard for financial transactions that provides a common language and structure for exchanging data between different financial systems and institutions.
Swift Go is another service Swift offers to facilitate fast international payments. Swift Go is similar to Swift GPI, with one key distinction: Where Swift GPI is designed to support high-value payments and all the various fees applied to them; Swift Go supports low-value payments, guaranteeing that the ultimate beneficiary receives the instructed principal amount. As a result, the target audience for Swift Go are individuals and small- and medium-sized businesses.
How can financial institutions benefit from Swift GPI?
Any institution that uses Swift GPI services:
Benefits from faster service level agreement (SLA) processing, in accordance with Swift’s updated SLA rulebook
Can make high-speed cross-border transactions; according to Swift, “Nearly 50% of gpi benefits are credited to end beneficiaries within 30 minutes, 40% in under 5 minutes and almost 100% of gpi payments are credited within 24 hours”
Gains the ability to track paymentsin real time, allowing for maximum visibility into all cross-border transactions — including those that use domestic rails beyond Swift — and early intervention should issues arise
Gains total transparency into processing fees, exchange rate costs and processing times applied to cross-border transactions, enabling financial institutions and corporations to make more informed decisions around liquidity and cash flow management
Has the ability to place a pause on payments in transit before they reach their final destination
Gets access to reliable remittance data; with access to this data, financial institutions and corporations can ensure the accuracy of fund transfers, mitigate fraud, engage in detailed transaction analysis and reporting, maintain regulatory compliance and resolve potential disputes faster
Can more easily navigate international banking rules and systems, including import and export restrictions, foreign exchanges controls and country-specific regulations
At the highest level, how does Swift GPI work?
To sign up for Swift GPI, financial institutions must comply with the technical, operational, security, availability, legal and regulatory requirements set forth by Swift. These include:
Ensuring that financial institutions operational environment is configured for resiliency to minimize any unnecessary downtime
Maintaining the confidentiality, integrity, availability and security of traffic, message and configuration data on its Swift infrastructure
Protecting and securing its local environment, including any internet-facing systems, against cyberattacks
Complying with Swift’s Customer Security Controls Framework and the Customer Security Controls Policy
Refraining from conducting performance or vulnerability tests on gpi services
Applying adequate Know Your Customer (KYC) checks to all cross-border transactions made through gpi
Complying with all relevant laws and regulations — both country-specific and general — for cross-border transactions
Meeting the SLAs outlined within Swift’s SLA rulebook
From there, the gpi onboarding process is fairly straightforward: Financial institutions and corporations undergo a 10-week initiation phase, followed by a three to nine-month implementation phase, a readiness-testing phase and, finally, a post-implementation phase. After go-live, organizations are fully set up to send and receive cross-border transactions in real or near-real time through the Swift network.
The actual process for sending and receiving payments through Swift GPI is as follows:
Outbound payments
The process for returning an item purchased using BNPL is much the same as it would be for any other item: The merchant processes the return as usual, notifies the lender and the lender cancels the debt.
Field 111 of the Swift Header is the value of the gpi service. These values include:
001 — for:
Swift GPI Customer Credit Transfer
Swift GPI Cover Service
002 — Swift GPI Stop and Recall
003 — Swift GPI for Corporates
004 — Swift GPI Financial Institutions Transfer
005 — Swift GPI Instant International Payments
Field 121 of the Swift Header is the UETR.
When Swift receives the instruction from the sender, it stores that information in its Tracker database. Depending on the service, Swift then passes on the instruction to the next agent bank — or prevents the instruction from proceeding, if it receives a gSRP request.
Inbound payments
Upon receiving instructions from another bank or a corporate entity, the receiving institution identifies the gpi service code. It then follows the actions outlined in the SLAs to process the instructions appropriately. Similar to banks that do not use Swift GPI, the receiving institution sends a status update back to the Tracker explaining how it processed the instruction. However, it ensures that this status update adheres to the gpi SLA rather than the SLA of a non-gpi member bank.
Here is an example of a gCCT transaction:
Is Swift GPI mandatory for financial institutions?
Although gpi is not mandatory from a regulatory perspective, it is in a financial institution’s best interest to implement gpi. Its real-time processing capabilities, payment tracking capabilities and payments transparency are essential to meeting consumer and industry demand and remaining competitive within an increasingly crowded global market. In short, Swift GPI is table stakes for institutions looking to provide a broader subset of services and gain more competitive standing.
How does ACI Worldwide support Swift GPI adoption and Swift Go?
ACI Worldwide supports various Swift GPI services listed above, as well as Swift Go through the ACI Enterprise Payments Platform.
A central hub designed to provide end-to-end payment processing from acquisition to settlement, the ACI Enterprise Payments Platform uses robust orchestration to streamline cross-border transactions and offers numerous interface integration points to support our clients’ specific business requirements.
Under the ACI Enterprise Payments Platform umbrella, ACI also offers a Swift GPI Data Service, which uses application programming interfaces to integrate corporate front-end systems with the Swift Tracker. The Swift GPI Data Service enables users to extract new insights from data pulled from the Swift Tracker. Financial institutions have the option of using the Swift GPI Data Service independently with their own engine, or to use a version that’s pre-integrated with out ACI Enterprise Payments Platform. Explore all of ACI Worldwide’s Swift GPI offerings today — read our complete guide or talk to a member of our team to learn more.
