They are set to sign a cooperation agreement that will enable the industry-wide adoption of the Bank Payment Obligation, which offers an alternative means of settlement in international trade.
SWIFT, the financial messaging provider for more than 9,700 financial institutions and corporations in 209 countries, and the Banking Commission of the International Chamber of Commerce are set to sign a cooperation agreement that will enable industry-wide adoption of the Bank Payment Obligation.
The ICC Banking Commission is a global rule-making body for the banking industry and a worldwide forum of trade finance experts whose common goal is to facilitate international trade finance.
The BPO is an alternative means of settlement in international trade and provides the benefits of a letter of credit in an automated environment. It enables banks to offer flexible risk mitigation and financing services across the supply chain to their corporate customers.
Both SWIFT and the ICC Banking Commission believe that by working together, they can achieve uniform adoption of the BPO, reducing costs and mitigating risks in international trade for buyers and sellers alike.
Gottfried Leibbrandt, Head of Marketing, SWIFT explains: “Industry forecasts indicate that merchandise exports are set to grow to 33 USD trillion by 2020, from 15 today. We are committed to help our members innovate in trade finance for corporates. We are delighted to cooperate with the ICC Banking Commission on this.”
Kah Chye Tan, Global Head of Trade & Working Capital, Barclays and Chairman of ICC Banking Commission confirms: “Trade Finance is a critical banking service supporting the world economy. It is vital that the industry aligns on enhanced rules and tools in support of trading counterparties whether large or smaller. The ICC Banking Commission views the development of the Bank Payment Obligation rules and the related ISO 20022 messaging standards as strong foundations for banks to provide modern risk and financing services aligned with today’s technology evolution."
The declaration of cooperation, to be signed at Sibos in Toronto, confirms the framework for collaboration between SWIFT and the ICC Banking Commission to publish and maintain a set of contractual rules that will establish uniformity of practice in the market adoption of the Bank Payment Obligation (BPO) and the related ISO 20022 messaging standards.
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