How ISO 20022 will revolutionize the payment industry in 2022 and beyond

How ISO 20022 will revolutionize the payment industry in 2022 and beyond

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Communication is vital to the success of any organization, community, team, and association. Without effective communication, partnership will be impossible.

In the financial industry, financial messaging standards specify the rules of communication for banks and other institutions.

Financial standards are definitions of business data captured in a structured model. Over time, domain-specific standards have been used by financial institutions for data interchange. Thus, banks faced a challenge navigating this difference in messaging format across different domains, leading to interoperability issues.

ISO 20022

In response to this challenge, the International Organization for Standardization (ISO) created the ISO 20022 standard to serve as a unified language for all. As the global ISO 20022 adoption draws near, there are questions about this new standard.

This article will shed light on the ISO 20022 messaging standards, and analyze their differences from legacy standards. We will also highlight the benefits it brings to financial services.
Let’s dive in!

WHAT IS ISO 20022?

If you are still wondering why there is a lot of buzz and hype around ISO 20022, this simple definition should give you a view of why.

ISO 20022 is an international standard that offers a common global language for exchanging electronic messages between financial institutions.

Created in 2004 by the international standards organization, the body provides a common platform for developing messages using a central dictionary, modeling method, a collection of extensible markup language (XML), and abstract syntax notation design rules (ASN.1).

In simpler terms, ISO 20022 smoothens cross-border financial transactions between institutions in different domains.

ISO 20022

For example, the term "Calling customer, payor, and payment originator” represents the same transaction. In ISO 20022, they can all have the same name without variations.

ISO 20022 message standard provides improved quality of payment data, thus enabling compliance, better customer experience, and improved efficiency.

It also offers payment services as a method to develop well-structured transaction messages and unify the existing standards. This will improve the organization's reach to their customers in different locations without worrying about local legacy standards.

Some notable players in the adoption and implementation of the ISO 20022 standards are, Omgeo, SWIFT, RIPPLE, AlGORAND, Visa, etc.

ISO 15022 Vs ISO 20022

Messaging standards have been in existence for a long time, leading to the development of different standards for relaying electronic messages. One of these methods is the ISO 15022, developed in 1995 as a successor of ISO 7775. It offered the securities industry a more effective tool to design messaging types that support their information flow.

Unlike ISO 7775 that contained messages standard like SWIFT message formats, the ISO 15022 standard does not. This is so that it can meet the needs of the industry as they arise.

ISO 15022 is the predecessor of ISO 20022, and it is in use in most financial institutions. However, it is not the same as ISO 20022 message standards.

ISO 20022 messages are more versatile and are not limited to specific formats. Thus, the quality of data sent between payment, securities, and internal systems is better.

ISO 15022 Vs ISO 20022


The development of ISO 20022 comes with a truckload of benefits to the financial industry. Asides from effective communication and a unified messaging standard, it has other unique features.These include:

Improved customer experience

ISO 20022 standard provides a wide range of resources that eliminates the communication barrier between financial institutions. This will lead to more transparency and accessible remittance information.

Improved customer experience


The ultimate goal of the ISO 20022 standard is to create a singular platform for relaying electronic messages and support the harmonization of all standards. Financial institutions will spend less time on manual confirmation of messages, saving time and money.


ISO 20022 will trigger stiffer competition between financial institutions as a result of the flexibility it provides. As a direct response, institutions will have to develop innovative ways to stay in the race and business.

Generate data analytics faster

Data is now an essential asset for all organizations, and the same is true of financial institutions. ISO 20022 delivers a framework to ensure that data is consistent, structured, and standardized. This will enable financial organizations to provide new and tailored products based on analysis of customer behaviors.

Other benefits include;

  • Improved resilience, driven by the ability to reroute messages and reduce the impact of outages on users.
  • Compliance and regulation: Institutions will have access to richer data to facilitate easier fraud detection and financial crime prevention.


The international organization of standardization’s objectives are to embrace the ISO 20022 migration process fully to develop standards and ensure the quality and safety of products and services across different industries. There exist different ISO certification standards, including ISO 9001, that cover specific industries and processes.

Although the ISO certification is not issued by the ISO but by third-party organizations, ISO still monitors the certification process.

The committee of conformity assessment (CASCO) is charged with managing the set of rules that third-party organizations must follow in carrying out ISO certification.

The ISO certification shows that a product or service is industry compliant. As an organization in the financial landscape where trust and transparency are of utmost importance, ISO certification is a proof that you offer top-tier services. Thus, improving the confidence of your customers and stakeholders.

Furthermore, being ISO certified gives your organization a competitive advantage over other businesses operating in your industry.

Lastly, it shows that you possess all the necessary tools and resources to deliver quality products consistently without compromising on industry standards.


The adoption of ISO 20022 is a revolutionary moment for the financial industry. Although the benefits are great, there lies challenges for lower-tier financial institutions in migrating from legacy standards to the ISO 20022 messaging standard.

SWIFT recently announced an updated release plan to the ISO 20022 implementation timeline. The updated timeline is in response to the worldwide disruption triggered by the outbreak of the Covid-19 pandemic. The timeline for full adoption changed from November 2021 to November 2022. This provides an opportunity for you to prepare your system to fully embrace the ISO 20022 migration process.

Data migration

As stated already, the ISO 20022 message format is different from Swift Mt format. What this means for you is that you have to prepare your workflows to adapt to this transition.

You will also need to analyze your business workflows to identify a suitable strategy for successful migration by the November 2022 deadline. The possible path will be to adapt your systems to ISO 20022 messaging standards directly or build a second layer integrated into the existing system to facilitate the processing.

At Boston Unisoft, we can help you navigate the complexity of the migration. We have over eight years of experience in building banking software solutions for companies in the FinTech space. With a team of dedicated designers, developers and analysts, we can help you analyze your existing system and develop a suitable strategy. Our team builds solutions compatible with the KYC & AML, PCI DSS, GDPR, and other regulations in the banking domain to protect your customers’ data and secure your company from fees and penalties.

Schedule a call with us today to get started on creating technical infrastructure to ease your ISO 20022 migration.

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