SWIFT gpi Instant goes live in the UK
Facing competition from non-bank upstarts in cross-border payments, Belgium headquartered interbank payments consortium SWIFT is rolling out its SWIFT gpi Instant service in the UK. Lloyds Banking Group is the first to go live with this service and the UK will be its first market.
SWIFT gpi is widely used by larger corporates, with hundreds of billions per day in transactions routed through the correspondent banking network. But it has been criticised by cross-border payments fintechs such as TransferWise, as being costly for smaller users in terms of fees and hidden FX costs.
In an email response to Commercial Payments International, SWIFT mentioned that its gpi service rollout in the UK is a real-time service that is routed via Lloyds. ‘Lloyds is offering the service to its overseas partners and clients so that they are able to offer instant payments to their corporate, SME and retail customers across the globe’.
BBVA had tested a pilot program to connect the SWIFT gpi network with the UK’s nationwide instant payment infrastructure back in October. BBVA group had run this test along with five financial institutions in Europe, North America and Asia-Pacific.
“This is an important milestone in our strategic ambition to help banks meet growing global demand for instant and frictionless cross-border payments,” said David Watson, Chief strategy officer at SWIFT.
Adding further he said that this new service puts emphasis on ‘speed, security, transparency and compliance’ and would bring out the benefits of cross border payment services to customers across the globe.
In the initial trials, SWIFT had roped in several banks including Bank of China, Barclays, BNP Paribas, BNY Mellon, Deutsche Bank, KEB Hana Bank, MYbank, National Australia Bank, SMBC, Standard Bank, StoneX, UniCredit and Wells Fargo.
“The gpi Instant service is set to be a game-changer in cross-border payments”, said Ed Thurman, Managing Director, Head of Global Transaction Banking, Lloyds Banking Group.
In 2019, SWIFT gpi payments saw $77 trillion worth of payments processed which represented 65% of all cross border messages sent over SWIFT. However, it did not mention the current updated figures when asked through an email response.
Lloyd will offer this service to its overseas correspondents and their customers which includes multinational, consumers or financial institutions which can use this service for payments with a threshold of £250,000 as per UK Faster Payments conditions.