Streamlining International Payments with Inquiry Automation
Are you curious about the critical role that Payment Swift inquiry messages play in the financial industry? These messages are specifically designed for inquiries and requests for information, allowing financial institutions to obtain essential transaction and account details quickly and efficiently. Keep reading to discover more about how these messages work and their importance in facilitating secure and effective communication between financial institutions worldwide.
Today, Swift inquiry messages are sent using SWIFT's MT 199 message type, which is designed explicitly for inquiries and requests for information. These messages contain several fields that allow financial institutions to specify inquiry details, such as the account or transaction in question, the type of information being requested, and the deadline for a response.
Inquiry messages are essential tools for financial institutions, as they enable them to obtain information about transactions and accounts quickly and easily, essential for effective risk management and compliance with regulatory requirements. They are also a key component of SWIFT's messaging system, enabling financial institutions to communicate securely and efficiently with each other worldwide.
Inquiry messages are typically used to request information about a specific transaction or account, and they can be sent by one financial institution to another or by a financial institution to its internal departments. They can be used for various purposes, such as requesting information about the status of a payment or settlement, requesting details about a particular transaction, or requesting information about a customer's account.
Two Different Messaging Standards
SWIFT MT messages and ISO 20022 MX messages are two messaging standards used in the financial industry. MT messages are used for financial transactions and communications between financial institutions, while MX messages are used for exchanging financial messages between businesses and institutions.
Greater Standardization Callouts - ISO 20022 MX messages provide a single, standardized messaging format used across different financial institutions and regions, making it easier to communicate and share data between systems, reducing the need for costly and time-consuming customizations.
Increased Efficiency -ISO 20022 MX messages are designed to be more efficient than the current SWIFT MT messaging format. They can carry more information and are easier to read and interpret, reducing the risk of errors and improving straight-through processing rates.
Improved Data Quality and Transparency - ISO 20022 MX messages include more detailed transaction information, improving data quality and enabling more effective risk management and compliance monitoring. This information can also provide greater transparency to customers and other stakeholders, helping to build trust and confidence in the financial system.
Support for New Payment Initiatives - ISO 20022 MX messages support new payment initiatives, such as instant payments and real-time gross settlement (RTGS) systems. By migrating to ISO 20022 MX messages, financial institutions can support these new payment initiatives and provide faster, more efficient payment services to their customers.
Challenges in Swift Inquiries
Converting a SWIFT MT message to an ISO 20022 MX message can be a complex task, as the two standards have different message structures and data formats. Therefore, the co-existence of both standards is necessary, at least in the short term.
Payment Inquiry Flow
The payment inquiry flow involves a sender requesting information about a beneficiary's bank account details using a SWIFT inquiry message (MT199). The beneficiary's bank responds with a SWIFT response message (MT900), which contains the requested information. The sender verifies the information and initiates a SWIFT payment message (MT103) to transfer the funds to the beneficiary's account. The sender's bank sends the MT103 message to the beneficiary's bank for processing.
The beneficiary's bank receives the MT103 message, credits the funds to the beneficiary's account, and sends a confirmation message (MT910) to the sender's bank to acknowledge receipt of the funds.
Manual Bottlenecks
Banks are tired of the manual processes involved in sending international payments via the SWIFT network.
They want to streamline payment flows and reduce errors. The solution to this is automation using tools such as jSWIFT, a Java library that provides a programmatic interface to the SWIFT messaging network
Assume we have a sender who wants to send a payment to a beneficiary, and both have bank accounts with different banks. Here's how the payment flow would work using jSWIFT:
1. The sender's payment system initiates a SWIFT MT199 inquiry message using jSWIFT. This message contains details about the payment, such as the beneficiary's account number and the amount to be transferred.
2. The sender's bank receives the MT199 message and forwards it to the beneficiary's bank.
3. The beneficiary's bank processes the MT199 message using jSWIFT, verifies the details of the payment, and responds with an MT900 response message.
4. The sender's bank receives the MT900 response message and forwards it to the sender's payment system.
5. The sender's payment system initiates an MT103 payment message using jSWIFT, containing the payment details and instructions for the transfer.
6. The sender's bank sends the MT103 payment message to the beneficiary's bank using jSWIFT.
7. The beneficiary's bank receives the MT103 payment message and processes it using jSWIFT. Once the payment has been credited to the beneficiary's account, the bank updates the account and sends an MT910 confirmation message to the sender's bank.
8. The sender's bank receives the MT910 confirmation message and forwards it to the sender's payment system.
With jSWIFT, this entire payment flow can be automated, reducing the need for manual intervention and streamlining the process. By eliminating manual processes, the risk of errors is reduced, and the time required to process the payment is significantly reduced.
How to Parse MT199 Swift Inquiries Messages
MT199 is a standard message format used by the Society for Worldwide Interbank Financial Telecommunication (SWIFT) for financial transactions. MT199 messages are used for inquiries related to financial instruments, such as foreign exchange or money market transactions. Parsing MT199 messages is a common task in the financial industry, and can be accomplished using various programming languages and libraries. In this blog, we will discuss how to parse MT199 Swift Inquiries messages using Java.
Overview of MT199 Swift Inquiries Messages
MT199 Swift Inquiries messages are structured using the SWIFT message format, which consists of three blocks: the Basic Header Block (Block 1), the Application Header Block (Block 2), and the Message Text Block (Block 4).
Recommended by LinkedIn
The Basic Header Block contains information about the sender and receiver of the message, as well as a unique message reference number. The Application Header Block contains information about the message type and receiver's Business Identifier Code (BIC). The Message Text Block contains the actual message content, which can include various fields such as the reference number, currency and amount, ordering customer, beneficiary customer, and details of charges.
sample
fin = "{1:F01BICFOOYYAXXX8683497519}{2:O1031535051028ESPBESMMAXXX54237522470510281535N}{3:{113:ROMF}{108:0510280182794665}{119:STP}}{4:\n"
":20:0061350113089908\n" +
":13C:/RNCTIME/1534+0000\n" +
":23B:CRED\n" +
":23E:SDVA\n" +
":32A:061028EUR100000,\n" +
":33B:EUR100000,\n" +
":50K:/12345678\n" +
"AGENTES DE BOLSA FOO AGENCIA\n" +
"AV XXXXX 123 BIS 9 PL\n" +
"12345 BARCELONA\n" +
":52A:/2337\n" +
"FOOAESMMXXX\n" +
":53A:FOOAESMMXXX\n" +
":57A:BICFOOYYXXX\n" +
":59:/ES0123456789012345671234\n" +
"FOO AGENTES DE BOLSA ASOC\n" +
":71A:OUR\n" +
":72:/BNF/TRANSF. BCO. FOO\n" +
"-}{5:{MAC:88B4F929}{CHK:22EF370A4073}}";+
This MT199 message is structured as follows:
Block 1: Basic Header Bloc
Block 2: Application Header Block
Block 4: Message Text Block
In Block 1, the sender's BIC (BANKGB2LAXXX) and a unique message reference number are specified.
In Block 2, the message type (I199) and receiver's BIC (BANKGB2LXXXXN) are specified.
In Block 4, the following fields are included:
Field 20: Reference Number
Field 23B: Bank Operation Code (AMND for Amendment)
Field 32B: Currency and Amount (USD1234567,89)
Field 50K: Ordering Customer (Name and Address)
Field 59: Beneficiary Customer (Name and Address)
Field 71A: Details of Charges (OUR for Our Charges)
Field 33B: Amendment Amount (USD8765432,10)
Field 72: Instruction to Amendk
Bank Operation Code
Here based on the field 23B, we can determine the intent Bank Operation Code (AMND for Amendment). Field 23B (Bank Operation Code) is used to indicate the type of operation requested by the sender.
The possible values for Field 23B are:
Parsing MT199 Swift Inquiries Messages Using Java
To parse an MT199 Swift Inquiries message using Java, we can use the Java SWIFT Message Library (jSWIFT) or ProWidesoftware's pw-swift-core - an open source library for working with SWIFT messages. It provides functionality to parse, validate, and generate SWIFT messages in Java. Here's a step-by-step guide on how to do it:
Step 1: Import the necessary classes from the jSWIFT library.
Step 2: Create an instance of the SwiftParser class and parse the MT199 message.
String mt199Message = "<MT199 message>"; // Replace with actual MT199 messag
SwiftParser parser = new SwiftParser();
SwiftMessage message = parser.parse(mt199Message);e
Step 3: Extract the relevant fields from the parsed message.
f (message.getBlock4() != null)
Field20 field20 = (Field20) message.getBlock4().getField("20");
Field23B field23B = (Field23B) message.getBlock4().getField("23B");
// Process the extracted fields as needed
System.out.println("Field 20: " + field20.getValue());
System.out.println("Field 23B: " + field23B.getValue());
}{
Step 4: Process the extracted fields according to your application's needs.
In this example, we simply print the values of Field 20 and Field 23B to the console. However, you may need to perform additional processing on the extracted fields, such as validating the values or storing them in a database.
Bank Operation Code based routing
Parsing MT199 Swift Inquiries messages is a common task in the financial industry, and can be accomplished using various programming languages and libraries. In this blog, we discussed how to parse MT199 Swift Inquiries messages using Java and the jSWIFT library.
There are several open source alternatives to jSWIFT for working with SWIFT messages. Some of the popular ones are:
1. ProWidesoftware's pw-swift-core - This is an open source library for working with SWIFT messages. It provides functionality to parse, validate, and generate SWIFT messages in Java.
2. SwiftAPI - This is an open source Java library for working with SWIFT messages. It provides APIs for parsing, validating, and generating SWIFT messages, as well as APIs for handling different SWIFT message types.
3. FinTP-Connect - This is an open source SWIFT messaging solution developed by Allevo. It provides functionality to connect to SWIFT networks, process SWIFT messages, and manage SWIFT infrastructure.
4. Swift4J - This is an open source Java library for working with SWIFT messages. It provides functionality to parse and generate SWIFT messages, as well as APIs for handling different SWIFT message types.
5. FinTS-IO - This is an open source Java library for working with financial transaction standards, including SWIFT messages. It provides functionality to parse, validate, and generate different financial transaction formats, including SWIFT messages.
Each of these alternatives has its own set of features and benefits, and the choice of which one to use will depend on your specific needs and requirements.
So we have seen an overview of Swift inquiry messages and their critical role in the financial industry. It explains how these messages work and their importance in facilitating secure and effective communication between financial institutions worldwide. The content also discusses the two messaging standards used in the financial industry, SWIFT MT messages and ISO 20022 MX messages, and highlights the benefits of the latter in terms of standardization, efficiency, data quality, and support for new payment initiatives. The content further explores the challenges involved in Swift inquiries and how automation using tools like jSWIFT can streamline payment flows and reduce errors. It concludes by discussing how to parse MT199 Swift Inquiries messages using Java and the various open source alternatives available for working with SWIFT messages.
Moreover, by automating the inquiry process, financial institutions can reduce the need for manual processes and improve the overall quality of service provided to their customers. The automated process can be designed to handle inquiries around the clock, providing customers with quick and accurate information whenever they need it.
Overall, the ability of Swift inquiry messages to handle inquiries automatically is a significant advantage in the financial industry, enabling financial institutions to provide better service to their customers while improving operational efficiency and reducing the risk of errors.
U.S. Chief Operating Officer at IKS Health
10moDoes anyone know which banks in the US market that can support an MT199 message?