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The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Welcome to the World of Swift Where Data is Becoming Essential

Welcome to our special Sibos edition. Yes, it’s that time of year again, when possibly all the world’s operational managers flock to whichever exotic location Swift has chosen. This year happens to be back in Copenhagen. We’re pleased with the choice as we quite fancy a break to the European city known for the Little Mermaid, and perhaps more importantly, Carlsberg beer.

But of course, it’s not just an excuse for a break. Hundreds of exhibitors will be working hard on their stands, while thousands of delegates take the opportunity to find out more about their services – and of course what Swift is up to.

And what Swift is doing is becoming more and more important for anyone in the reference data industry. As you’ll see from our front page story, Swift is getting ambitious in the reference data space, with plans to widely expand the scope of data beyond corporate actions that can be transported via its Swiftnet network.

This is good news for standards, and good news for those sophisticated users that can interface to the data and afford the associated fees. It is also good news for the data vendors, for whom the broad audience on the network has suddenly opened up. Why then, has the take-up of vendor corporate actions data on the network been slow, and why have some vendors taken longer than they initially projected to come on board?

The key reason is that demand has not been high enough. This is in part due to the costs of using the network. It is also because many organizations, except for the advanced ones, have not adapted their downstream applications to handle the standard-formatted data. This can be attributed to the fact that, as one of our vendor friends said, “there isn’t enough pain yet”.

But as new regulations continue to take hold, the pressure will be on the financial institutions to become more and more operationally efficient, and corporate actions is one big trouble spot for them that needs to be addressed.

As Swift’s Catherine Marks said, the data service over Swift has “challenged firms to make operational changes and perhaps software changes.” So although slow, change is happening. Both Swift and the vendors involved believe that it is only a matter of time before the take-up begins to rise significantly. This optimism is further fuelled by the fact that Swift now sees the ‘Data Distribution’ initiative as a strategically important aspect of its services. This has led to the expansion of its plans beyond corporate actions data. Reference Data Review will be keen to see how and when other data types are added to the network and how the level of usage improves between this Sibos and next years in sunny Australia. We at Reference Data Review are already getting our cork hats ready for the trip…

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