Innovation in Unexpected Places
In a way, one story covered by Inside Reference Data this week reflects ongoing trends and advances in the development of the Internet and communication in society as a whole. Financial industry messaging provider Swift is moving its standing settlement instruction (SSI) format away from a broadcast-only style one, MT 074, to a dual format, MT 670/MT 671, that allows for sending and receiving SSI messages in a more interactive fashion.
The greatest analogue to this change for the financial industry can be found in the effect the web is having on television programming as we once knew it. Streaming web video from YouTube, Hulu, Netflix and Amazon and others allows viewers to pick and choose their programming in a way that wasn't possible when there were just broadcast networks and isn't possible with cable television providers. And in Swift's new SSI format, users can select certain categories within certain fields in the format, such as the type of transaction or national clearing code, thus defining and selecting what they're getting.
Reaching back to the beginnings of what made the Internet possible—packet switching, the technology that allows digital messages to be sliced into parts, transmitted and then reassembled at their destination—finds a similarity in the content of the MT 670 message itself. The message format contains codes indicating to whom and where SSIs are to be sent, what currency applies and where that currency needs to be paid. Effectively, these are routing instructions for payments and settlements, in the same way packet switches govern message routing.
The point of these somewhat roundabout comparisons is that even within financial securities messaging, which might seem like it doesn't require forward-thinking innovation, there is room to innovate and a need for it. With the SSI format change, Swift is indeed innovating.
In keeping with innovation and staying current, next week, Inside Reference Data plans to bring you new multi-media content from our European Financial Information Summit on September 18 in London. Please watch for that toward the bottom of our homepage.
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