Swift takes step towards ESMIG Network Service Provider status
Swift has overcome the first hurdle as it seeks to be selected as a provider for the Eurosystem Single Market Infrastructure Gateway (ESMIG). The Society has completed the first phase of the tender, which is being run by Banca d’Italia, reports Martin Whybrow.
Swift already has connectivity to EBA Clearing’s Euro1/Step, RT1 and Step 2 services
If successful in the next phase, Swift would become a Network Service Provider for ESMIG from its intended launch in November 2021, providing connectivity for the Eurosystem’s Target Services.
Swift already has connectivity to EBA Clearing’s Euro1/Step, RT1 and Step 2 services. As such, banks would be able to use Swift as a single connectivity point to process all of their euro payment messages – high-value, SEPA, instant and cross-border payments.
The ESMIG project is part of the European Central Bank’s Vision 2020 initiative, which will see the Target2, T2S, TIPS (Target Instant Payment Settlement) and collateral management services move to a new common infrastructure, with a central communication access point.
It is intended to have up to three ESMIG Network Service Providers. Italy-based SIA, with its SIAnet, is likely to be in the mix. Last year it became the first Network Service Provider to gain Eurosystem certification for TIPS.
The Eurosystem changes are intended to improve the integration of financial and capital markets across the EU. The single connectivity gateway to all Target services would provide a simpler and more efficient means to access the key market infrastructures.
EBA Clearing also plans to migrate Euro1 to ISO 20022 in 2021, which matches the Eurosystem timeframe, to allow its users full business interoperability between Euro1 and Target2. In addition, at the end 2021, Swift will begin migrating all cross-border and many-to-many payments to ISO 20022, with the timescales aligned with the ISO 20022 migration of the Eurozone’s high-value payments systems. Swift will provide a four-year co-existence phase.
It all adds up to far-reaching changes for the European payments landscape and a hefty workload for participants.
