How to modernise a dinosaur?
This seems to be the challenge of
banks and payment systems today, according to Mr Leo Lipis, Lipis
Advisors. Leo Lipis presented their unmatched survey of 46 clearing
institutions for low-value payments systems across 31 countries and
regions, whereby data, surveys and interviews were used to gain a
thorough picture of the current status.
Among the important findings was that banks and payment systems are
driven to change. Their goals are within ‘risk management’, ‘regulatory
compliance’ and ‘customer protection’ and they focus on:
•
AML/CTF screening, which is essential in nearly every country. En-
forcement is aggressive and penalties more severe, so banks reject
clients based on clients’ inadequate KYC
•
More remittance data and transparency: with the focus on timing and
cost of transaction, F/X rates, and visibility at intermediary banks
•
Real -time payments: these are becoming commercially viable,
whereas settlement need not be in real time
Financial inclusion drives new products, expanded networks and infra-
structure development.
Although banks are already disintermediated in many aspects of
payments, banks still have an opportunity to reclaim some lost ground.
Sometimes re-inventing the wheel is a good idea!
3
Eurogiro’s first major event in Asia,
indeed in Vietnam, was in May
2015, in Ho Chi Minh City, and there was much support and interest
from Vietnamese financial institutions to embrace this opportunity to
build new business relations.
The chairman of Vietnam Post, Mr Do Ngoc Binh, welcomed everyone
with best wishes for the outcome of the meeting and warm wishes for
the well-being of the participants. The colleagues from Vietnam Post
were very active and helpful throughout the meeting and many Eurogiro
members took advantage of the opportunity for direct talks. Vietnam
Post, as the first Eurogiro member in Vietnam, co-hosted the event.
Vietnam Post is an active receiver of Postal Money Orders from Euro-
giro members, and also offers a large range of letter, parcel and logistic
services to its customers alongside its financial services and also offers
eCommerce services.
The most recent Eurogiro member, AgriBank, is also from Vietnam and
has used the opportunity to set up new partnerships with Eurogiro mem-
bers. AgriBank is one of Vietnam’s leading banks in workers’ remittanc-
es for cash out-payments, as well as payments into accounts, and is
looking to expand this business through its Eurogiro membership.
SeABank, Vietnam, was invited to join as an observer and prospective
member.
3
After a period
during the recent financial
crisis where payments could be viewed as
a stable and low risk line of business, this is
changing fundamentally with the introduction
of much stricter regulations, not only in the US
and Europe, but across the world. Further-
more, legislation has been followed up by
unprecedented large penalties administered
to financial institutions for non-compliance.
A significant part of the Eurogiro community
meeting in 2015 was dedicated to this topic.
Mr Michael Obrist, Deutsche Bank, outlined
the big picture of compliance requirements.
The chairman of Eurogiro Compliance Audit
Group, Mr André Blum, Swiss PostFinance,
gave practical advice regarding organisation
and best practice for sanctions screening.
Finally, the Euro Settlement Service Pro-
vider, Deutsche Postbank, represented by
Ms Susann von Gunten, presented the next
generation ESSP which had been upgraded
to meet future compliance requirements.
Components of a robust and flexible sanctions
framework were defined as: (filter) technology,
a legal program after the principle of ‘no one
size fits all’, and an operational set up with
controls and continuous quality assurance
and, finally, a corporate culture where the
framework is embedded with understanding
and awareness.
Eurogiro members may retrieve advice on
best practice from the members’ only section
of
Mr Do Ngoc Binh, chairman of Vietnam Post.
Mr Leo Lipis, Lipis Advisors (left) with
Eurogiro CEO, Mr Michel Stuijt.
6 Eurogiro News
