SWIFT FOR CORPORATES

Since 1973, the SWIFT network has enabled banks to exchange financial messages with other banks in a
controlled, private, secure, and standardized environment. The network is best known for carrying wire
transfer messages, but it also relays many other financial messages such as those for trade, securities, and
foreign exchange, as well as information reporting.

Why are corporates exploring the option of connecting with SWIFT?

✓ Pain points: The increasingly global nature of business means that companies of all sizes often deal
with multiple banking partners integrating with a variety of bank communication interfaces and
channels. As a business critical function, the security of a bank interface is of paramount importance
for securing the associated data flows.
Solution: By implementing SWIFT, Corporates benefit from a single highly secure and reliable
window to communicate with all their banking partners using global standardised financial messages.
✓ Pain points: Treasurers and/or credit managers have to deal with significant operational burdens,
often done manually to get an accurate and global view on liquidity and liability across their portfolio.
Solution: SWIFT brings key benefits such as central visibility of cash positions, decreased operational
risk and costs, and increased automation levels with integration possibilities to connect to a
business’s existing systems.

How do the corporates connect with SWIFT?

1. Closed User Group

✓ Member Administered Closed User Group (MA-CUG)

In 2001, SWIFT gave corporates direct network access through the Member Administered –
Closed User Group (MA-CUG) model, which requires each corporate to be sponsored by a
member bank. A corporate in a bank's MA-CUG can only interact with that bank. If a
corporate interacts with, say 20 banks, it must join the MA-CUG of each of those 20 banks.
The result is a lot of time-consuming sign-up documentation and additional implementation
procedures. Therefore, a Member Administered Closed User Group will have a one-to-one
connectivity between a corporate and a bank.
In a MA-CUG, the corporate does not become a SWIFT member, but becomes a sub member
through the bank, under whom the corporate will operate.

✓ Many-to-Many Closed User Group

It is possible that a few banks say Banks A, B and C come together and form a Closed User
Group. If a corporate joins such a CUG, corporate will be able to communicate with all the
three banks A, B and C. This is a limited version of SCORE.
 2. SCORE (Standardised Corporate Environment)
In an effort to remove the constraint of being part of multiple MA-CUGs, SWIFT introduced the
SCORE (Standardize CORporate Environment) model of corporate access in January 2007. With
SCORE, eligible corporates can join a single, large, closed user group administered by SWIFT to
interact with all participating SWIFT member banks. In other words, users sign up once for network
access directly through SWIFT rather than through all of their banks individually.
As a result of the introduction of this new model, only corporates that do not meet the SCORE
admission criteria are now likely to consider the MA-CUG model for SWIFT access.

Advantages of SCORE
✓ Corporates can connect directly with multiple Financial Institutions through a single, secure,
bank-agnostic channel.
✓ Enables corporates to overcome the challenges of multi-banking, streamlining, and
automating their business cash flows by communicating with banking partners all around
the world using a global standardised ISO (MX) and proprietary format (MT).
✓ SWIFT messaging standards enable straight-through processing of reporting and exception
management.
✓ Applying standardised processing over SWIFT increases the level of automation and
removes duplicated processes, resulting in staff productivity gains.
✓ Receiving end-of-day or intra-day reporting directly from all your banks increases funds
visibility and facilitates improved management of working capital requirements.

3. TRCO (Treasury Counterparty)

In this mechanism the corporate can send a message to any bank on SWIFT but has got a limitation.
The message allowed to send under TRCO model is a Treasury Deal Confirmation. This means only
once corporates have done a deal with the treasury of the bank, can they confirm having done a
treasury deal with the bank. Corporates cannot use the TRCO model for creation of payment
transactions but use to confirm transactions done with a particular bank.

Integration With The SWIFT Network

No two corporates are the same when it comes to global banking. Whether a Global Fortune 500
company or SME, each corporate is likely to have different requirements while integrating to the
SWIFT network. Determining the right option is typically driven by business volume and operational
model complexity but can also include factors such as regulatory requirements. The four options for
connecting to the SWIFT network are:
✓ SWIFT’s own cloud solution, called Alliance Lite2, whereby corporates can integrate with their
own ERP/TMS applications using a light footprint
✓ Fully integrated solution via existing business applications like a Treasury Management
System (TMS), called Lite2 for Business Applications (L2BA)
✓ SWIFT’s on premise gateway, Alliance Gateway and standard out-of-the box offering, called
Alliance Access.
✓ Connectivity option as part of third party services offered by a Service Bureau that is SWIFT
certified.