ISO 20022 could streamline B2B payments, especially cross-border, according to industry analysts. Fed has provided an update on its progress to encourage ISO 20022 adoption, but getting ISO 20022 to really gain traction faces challenges.
The biggest challenge is the ongoing lack of understanding around the messaging standard. To overcome this obstacle, the Fed has created a guide to help educate financial institutions and corporates on ISO 20022 in response.
One of the biggest hurdles in efforts to promote the adoption of ISO 20022 is National Automated Clearing House Association (NACHA), which has yet to decide whether it will implement ISO 20022 for ACH payments.
Once wire payments move to the ISO 20022 standard, ACH payments will soon follow. This could create opportunities for global companies to streamline some of their processing with their bankers.
The ISO 20022 adoption efforts will be instrumental in other payments initiatives presently in the works, like the Fed’s Faster Payments goals and The Clearing House’s own projects.
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