webinar materials | psd2: ensuring a seamless payments journey - connecting apis and iso 20022
TRANSCRIPT
Webinar PSD2: Ensuring a seamless payments
journey, connecting APIs and ISO 20022#xmldationwebinar
Content
PSD2 background
ISO 20022 usage and adoption
JSON APIs and ISO 20022 XML
PSD2 Background
PSD2 Overview
Main purpose : open up market for payments services
Banks must provide 3rd party access to payment initiation and account information services
• Under well-defined conditions
Defines policy, doesn’t set technical direction
Useful explanation • https://www.starlingbank.com/explaining-psd2-
without-tlas-tough/
PSD2 Timeline
Jan 2018 : • PSD2 transposed to
national law
Sept 2018 : • earliest date for security
aspects
http://digitalbaobab.com/wp-content/uploads/2016/02/psd2-timelines.pdf
Technology
RESTful JSON APIs are a natural choice
Wide adoption in other industries, simplicity is keyUsed by Fintech, and in Digital and API Programmes at banksUsed by Challenger banks
Aggregators
Standards-related Activity
http://www.berlin-group.org/ open interoperability standards and harmonisation initiative, the NextGen PSD2 Taskforce
https://www.caps-services.com/open framework realising the regulatory intent of PSD2 (aggregator)
https://www.abe-eba.eu/thought-leadership/regulatory-guidance/New publications in early 2017
Non-PSD2 : UK CMA Open Bankinghttps://www.gov.uk/government/news/cma-paves-the-way-for-open-banking-revolutionStandards sometime in 2017
(There is also work ongoing in security)
ISO 20022 Usage and Adoption
What is ISO 20022?
Standard for Financial Messaging, iso20022.org
Agreed vocabulary for financial services & financial data exchanged between parties
• Uses XML currently• Can use other syntaxes e.g. ASN.1• Plans to publish JSON syntax in 2017 ??
Growing global adoption
https://www.iso20022.org/adoption.page, April 2016
SEPA and CGI-MP corporate to bank, including account statements; SEPA bank to bank;SEPA instant payments, Nov 2016, http://www.europeanpaymentscouncil.eu/index.cfm/sepa-instant-payments/sepa-instant-credit-transfer-sct-inst/European Target2SPayments Canada, 2020US Chips, high value payments, 2020Etc
JSON APIs and ISO 20022
ISO 20022, SEPA, SEPA
Instant Payments etc
API Platform
JSON APIs
Core Banking
Platforms
Integration Middlewar
e
Mobile Apps
Mobile Apps
API Platform
Core Banking
Platforms
Integration Middlewar
e
JSON APIs
Bank payment systems increasingly ‘speak’ ISO 20022APIs and ISO 20022 payments infrastructure will coexist
Following ISO 20022 Best Practices
ISO 20022 solves longstanding issues • E.g. remittance information
Has an agreed vocabulary forfinancial domain
https://www.swift.com/file/23901/download?token=izEXYBlb
Aligning JSON APIs and ISO 20022
XS2A Example: account statementExample account details in JSON
ISO 20022 camt.053 XML, account statement
SimplicitySimplicity is critical for APIsDirect mapping of ISO 20022 will be too complex
“Basic” ISO 20022 XML pain.001 credit transfer : 110 lines
Simplicity – Detailed Example
InitgPty / Initiating Party in ISO 20022 = company initiating a credit transfer
ISO 20022 XML Directly Mapped JSON : longwinded
The essentials in JSON : much simpler
Useful precedents e.g. Currency
Notes:A simplistic API might ‘assume’ a currency valueISO 20022 mandates that you explicitly define currencyISO 20022 follows a standard for currency codes (ISO 4217)Previous SWIFT MT standard combined currency and amount in a single field:
• makes life difficult for developers
From SWIFT MT940 : earlier generation of account statements, still in widespread use
ISO 20022 XML Corresponding JSON
(D/C Mark)(Date)(Currency)(Amount)
Other examples….
Consider using credit / debit indicators, not negative amounts
Remittance information : limitations on characters (latin, cyrillic etc)
Structure of postal addresses
IBANs and BICs, and when they are required
Standard for identifying countries and bank transaction codes
Etc…
Advice on getting started
Review APIs against ISO 20022 thoughtfully• What fields are important in ISO 20022• What fields should be mapped directly• What business rules need to be honoured (ISO 20022
& bank) • Keep simple, align where reasonable
Careful mapping will facilitate interoperability
Monitor standards activities around APIs
XMLdation PSD2 / API OfferingSaaS platform for managing API definitions
With automatic generation of API validation policies, test components and Developer Portal content from a single source
PSD2 Consultancy Advising / supporting bank teams to reach PSD2 compliance and launch
Fintech partnership programmes
Bank ChallengesPSD2
Compliance
Bank Programme Tracks
Time to Market
Business of APIs
API Layer Access and Identity
API Integration to Backend
End to End Testing
Partnership Model
Developer Supports
Benefits
XMLdation API Offering
Product Management
ITdev &testing
API Project
Onboarding& support
Client
Businessdevelopment
API definition management
Onboarding
Developer Services
Production Systems
API Validation Policies
Test Automation Framework
Test Components
Bank IT Environment
• XMLdation is a world leader in end-to-end testing of standardised financial transaction messages : ISO 20022, SWIFT MT, JSON APIs
• Our innovative Software-as-a-Service assists banks, e-invoicing providers, clearing houses, financial software vendors in the implementation, testing and maintenance of transaction messages.
• XMLdation service is used by more than 20 banks in over 50 countries worldwide
• Headquartered in Tampere, Finland; Office in Cork Ireland• Established in 2009• Video http://myxml.is/offering16
@api_lifecycle @xmldation
Next PSD2 WebinarThursday Feb 16, 2017Tuesday Mar 21, 2017
PSD2: Implementing APIs that interoperate with ISO 20022
More on API / ISO 20022 alignment
Defining ‘ISO 20022’ business rule policies for APIs
Applying ISO 20022 policies on an API platform
Wrapup
Register for upcoming webinarshttp://www.xmldation.com/en/company/events-list
Webinar slidesSlides will be posted to website after webinars. You will receive a link by email.
Getting started with PSD2Drop us an email at [email protected], and we’ll help