SWIFT releases API standard for pre-authorization of funds

SWIFT

Stephen Lindsay, Head of Standards at SWIFT

SWIFT has announced a new API standard for the Pre-authorisation of funds in a bid to enhance open banking’s scope in the financial services industry. The supplier has stated that the new API standard enables the payer’s bank to bookmark funds for purchase in advance, thereby guaranteeing the future processing of the payment.

Stephen Lindsay, Head of Standards at SWIFT, said, “SWIFT is uniquely positioned to tackle the problem of fragmentation in standards globally and we are pleased to expand our current role to include the global standardization of open banking APIs. Our work on the pre-authorisation of funds API is another example of the central part we are playing in ensuring the industry can make the most of the new open banking landscape.”

This is the second one of SWIFT’s Open Banking Extensions API Standards and it adds to the Pay Later API that it published earlier this year. The supplier’s standardization offerings are expected to avoid the complexities that will occur with the adoption of different APIs by merchants and fintechs.

Tony McLaughlin, Managing Director, Treasury and Trade Solutions, Citi commented on this, “The SWIFT Pre-Authorization API is further validation that banks, Fintechs and merchants can collaborate to build Open Banking APIs that go beyond the regulatory minimums to support vitally important use-cases. The global banking community must come together to provide the full suite of retail and wholesale banking APIs so that we can provide the financial layer of the digital economy. The world of platforms provides unlimited new opportunities for banks if they adopt an ‘API first’ mindset.”

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