SWIFT Embraces Upgrade to Cloud
SWIFT, the La Hulpe, Belgium-based operator of a global messaging network for securities and other transactions, has pushed its cloud-based connectivity up a notch.
As of September 1, financial firms which want to communicate with each other over the SWIFT network, can do so through a new cloud-based connectivity option called Alliance Lite2. SWIFT officials say the new option system combines SWIFT's connectivity and reliability with the convergence of cloud-based connectivity so financial firms don't have to keep SWIFT equipment on site as is the case with Alliance Access and Alliance Entry. All that a financial firm needs to access SWIFT is a USB token which it can insert into its laptop and use a password to log on. SWIFT provides the personal USB security tokens.
Alliance Lite 2, as the name implies, is an upgrade to Alliance Lite which is also a cloud-based platform launched in 2009. The key differences: Alliance Lite2 supports much higher message volumes and a wider range of message types than its predecessor so it is likely that some of Alliance Lite's customers might want an upgrade. Alliance Lite2 is also being marketed to existing SWIFT customers as a reliable fall back connection should an emergency occur. Linking to SWIFT does come with plenty of operational stress -- and cost -- so SWIFT needs to offer as many alternatives as possible to gain new customers -- or better service older ones --to promote message traffic
"Alliance Lite2 is the first deliverable in our 2015 strategy to provide cloud-based access to the SWIFT network and related services and business applications from members," says Juan Martinez, director of cloud services for SWIFT. That strategy, revealed in 2010, was aimed at cutting costs and increasing message traffic through the SWIFT network used by over 10,000 financial institutions. Alliance Lite was introduced in 2009.
SWIFT officials won't specify the differences in throughput and costs between Alliance Lite2, its predecessor and more robust higher-volume options such as Alliance Access and Alliance Entry where financial firms must install SWIFT's interfaces in their own shops. Also not disclosed is the number of users for each alternative, but acknowledge that Alliance Lite was designed for customers sending very low volumes of messages over the SWIFT network while Alliance Lite2 will meet the volume requirements of most of SWIFT's customers. Like Alliance Access, Alliance Lite2 has screens to enter and display all of SWIFT's legacy ISO 15022 and newer ISO 20022-compliant message types while Alliance Lite's screens can accommodate a more limited number of SWIFT message types. Alliance Lite2 also supports the same file formats as the more sophisticated and scale able Alliance Access -- and far more than Alliance Lite -- for automated message and file transfer.
"Alliance Lite2 takes a service bureau approach with SWIFT hosting all of the connectivity requirements and allowing the vast majority of its customers to meet their volume requirements," explains Ed Adams, a regional manager for the Americas at SWIFT. Adams insists that SWIFT is not competing against some of its largest global custodian bank customers -- namely Brown Brothers Harriman --which also provide their clients with electronic communication hubs for message transmission. However, fund managers believe there is plenty of overlap to suggest potential rivalry.
Written by Chris Kentouris, Editor-in-chief (Chris can be contacted through Chris.Kentouris@hotmail.com)