JP Morgan and SWIFT's Treasury Complete Alliance Lite Pilot
JP Morgan’s Treasury Services business and the Belgium-based treasury department of SWIFT have successfully completed a pilot of SWIFT Alliance Lite, SWIFT’s most recent Internet-based interface to enable SWIFT customers to make payments without a heavy technology investment. The pilot, which included wire payment initiation and account reporting, took two to three weeks from the beginning of the set-up process to the conclusion of sending and receiving the transactions. SWIFT’s treasury has plans to extend its usage further in the future.
SWIFT Alliance Lite allows any SWIFT user to access the SWIFT network without the investment in telecoms and computer hardware and software usually required. Alliance Lite users can send a range of SWIFT instructions and payments to their banks and receive account statements and other reports from their banks while benefiting from the security and resilience of SwiftNet.
Messages received by a bank from users of Alliance Lite are indistinguishable from messages received from other SWIFT users, so no software changes or enhancements are required to enable existing SWIFT users to communicate with Alliance Lite users. As a result, the new product extends the potential population that can communicate using SwiftNet.
Although initially conceived by SWIFT to address the needs of small financial institutions, Lite is attractive to corporates that need to communicate to a large number of banks and, therefore, prefer a bank neutral channel or a channel that has reach to many banks. JP Morgan is looking to pilot Lite with a large corporate in the US, which is not currently connected to SWIFT.
In an interview with gtnews, Brian Wedge, SWIFT product manager at JP Morgan’s Treasury Services business, explained that the bank will not be rolling it out to its clients per se, but that Lite will be another option for SWIFT connectivity, alongside JP Morgan’s proprietary channel. “If it suits the client’s particular circumstances to use SWIFT Lite, then we are more than happy to talk to them over that channel. If we come across a situation where it seems to be a natural fit for clients, then we might promote it but we also have our proprietary channel that will continue to exist. Clients need to choose the channel that works best for them,” he said.