As the FX market is evolving, so are the expectations of corporates operating within it. They are looking for certainty and transparency in the multiple unknowns of a cross-border transaction.
Industry led tools such as SWIFT GPI and ISO 20022 are paving the way for financial institutions and their clients to further embed data into their core processes and infrastructure.
- The SWIFT GPI initiative compels financial institutions to share vital information throughout the payment life cycle with their corporates, including hidden fees and routing decisions. This allows corporates to gain greater control, certainty, visibility into end-to-end transaction and make better decisions to drive optimal processing outcomes.
- ISO20022 is aimed at standardizing the communication language between parties on the SWIFT network, allowing for richer data to be passed, creating opportunity to drive new, more detailed insights on transactions.
Specific to FX transactions, risk management tools, such as Guaranteed FX Rates, are available to corporates to gain greater certainty over FX rates applied to their cross-border transactions. This is becoming ever more important as the market is facing continued uncertainty and volatility in the face of various geopolitical and economic events. Algorithms and machine learning techniques are used by financial institutions to power such solutions, helping corporates effectively manage their FX risk.