15 African banks have signed up to SWIFT’s global payments innovation (gpi) service, the new standard for cross-border payments. Of these, four are already live – Standard Bank of South Africa, FirstRand Bank, ABSA Bank and Nedbank – and many others are preparing to go live on the service in 2018.
SWIFT gpi is the largest change in cross-border payments over the last 30 years. More than 100 billion USD in SWIFT gpi messages are being sent every day, enabling payments to be credited to end beneficiaries within minutes – many within seconds. The service has already been adopted by more than 160 financial institutions around the world, with 55 banks already live on the service sending hundreds of thousands of payments daily across 350 international payment corridors.
Overall, nearly 50% of SWIFT gpi payments are credited to end beneficiaries within 30 minutes, and almost 100% of payments within 24 hours. Those that take longer typically involve more complex foreign exchange conversions, compliance checks or regulatory authorisations. For Africa, these numbers are even better. 70% of gpi payments leaving Africa are credited to the end beneficiary within 30 minutes.
SWIFT gpi also enables the banks to leverage new technologies such as API. African banks are embracing these opportunities and have implemented this new technology to better serve their customers. The SWIFT gpi API solution allows them to easily integrate the gpi tracker in their internet banking channels and provide better services to their customers.
Denis Kruger, head of Sub-Sahara Africa, SWIFT, said: “We are delighted that Africa’s leading banks are committed to SWIFT gpi – the new standard for cross-border payments. The performance of African banks on gpi to date clearly demonstrates the competitiveness of the African banking sector as it continues to evolve its customer offering and support African economic development.”
In addition to the 160 financial institutions that have adopted gpi, more than 50 payment market infrastructures are already exchanging gpi payments, enabling domestic exchange and tracking. Payment market infrastructures have a critical role to play in facilitating the end-to-end tracking of cross-border payments because as soon as international payments hit the destination country, they are typically cleared through local payment infrastructures. By being able to continue to track the payments in real-time, banks and their corporate clients can optimise their funds.
“Thanks to SWIFT gpi, banks are able to credit payments within minutes and even seconds, while their customers are facing shorter supply cycles and able to ship goods faster. This is a very significant step forward for banks and for their customers” says Harry Newman, Head of Banking, SWIFT. “In addition, banks receive fewer queries and have told us their enquiry-related costs are reduced by as much as 50% when they use SWIFT gpi. This is a major service improvement to end-users and a considerable cost saving for the industry.”
“We have seen a surge in both gpi adoption rates and number of transactions, and we expect adoption of SWIFT gpi to now grow very significantly. Instead of focussing on a limited number of bilateral routes which has limited value both for banks and their customers, gpi already offers very extensive coverage across banks, markets and geographies. By adding new banks and corridors every day, SWIFT gpi ensures banks and their customers get a truly global, fast, secure, and transparent cross-border payments service.”