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INstream Provides SWIFT Payment Monitoring and Visibility for Swedbank

  • July 01 2004, 1:00am EDT

REVIEWER: Elisabeth Johnson, head of clearing, SVP, at Swedbank.

BACKGROUND: Based in Stockholm, Sweden, Swedbank (FöreningsSparbanken) has approximately 6 million customers and 15,000 employees. The company also has more than 2 million Internet banking customers and more than 1 million telephone banking customers. Swedbank offers its customers a variety of financial and banking services, including checking and savings accounts, credit cards, electronic banking, loans, investments, real estate brokerage services and life insurance. The bank has 820 branches, 235 in-store banks and more than 1,100 ATMs.

PLATFORMS: Swedbank runs Unitech Systems INstream software on the IBM z/OS platform.

PROBLEM SOLVED: At Swedbank, we strive to be the obvious choice among banking alternatives for private individuals, companies, the agricultural sector, municipalities, county councils and organizations by offering a range of customized easy-to-use financial services. That is why we wanted to eliminate operational risk exposures within our payment system. We define operational risk as the risk of losses due to inadequate or insufficient internal routines, human errors, faulty systems or external circumstances. As part of our Internet payment business, we need to track SWIFT-formatted payments going through the clearing system. During processing, we have to check transaction description fields to ensure that payments stay the same throughout our transaction balancing process. At the end of the process, the SWIFT network sends our system a message to acknowledge if our payments were accepted or rejected. Payment processing requires data timeliness and transaction accuracy because our systems must process each SWIFT payment in six minutes or less - and perform a latency check between each step. If we do not complete processing within this time frame, we incur a penalty. To ensure processing efficiency, we needed a way to quickly identify process problems so that we could take corrective action to ensure compliance with our service level agreements. We chose the Unitech Systems INstream solution because it provided the real-time visibility and control that we needed to ensure high customer satisfaction.

PRODUCT FUNCTIONALITY: INstream provides us with value tracking and latency checking as we process payments through multiple applications including Pay+, ProSwitch and the SWIFT interface. We also use WebSphere MQ middleware as a communication messaging system between our processing applications. INstream integrates directly with our WebSphere MQ middleware to track all of our payments from sign-on through payment transfer. The primary benefits we receive with INstream are reduced operational and financial risks, and lower costs with improved cycle time processing for payments valued at approximately $100 million ($800 million SEK) daily. INstream helps us accomplish this by allowing our employees to easily pinpoint and resolve errors.

STRENGTHS: INstream became our "red alert" system because it provided the highly effective detection capabilities that we needed for our incoming and outgoing payments. INstream also detected that our WebSphere MQ middleware - and not our systems - was causing errors. In addition, using INstream helps us to identify errors as early as possible.

WEAKNESSES: INstream currently does not provide the capability that we need to create historical reports in a user-defined format. However, the next release of INstream will include the functionality that we need to perform ad hoc reporting.

SELECTION CRITERIA: We had initially considered using an in-house solution, but we decided to buy the Unitech Systems INstream solution because it had the functionality that we needed and also provided us with an external audit function.

DELIVERABLES: With INstream, our employees receive messages on their monitoring consoles to alert them to processing issues as soon as they arise. This solution also provides helpful control reports.

VENDOR SUPPORT: INstream was very easy to install and implement, and we did not have to do a lot of work to get the product up and running. In fact, we expected that it would take 10 days to implement the software, but it only took us four. In addition, the Unitech Systems Product Support team is very responsive and helpful, and has always been there when we needed them. Every time that we have called in with a question or problem that we could not solve, we have always received the help that we needed.

DOCUMENTATION: The documentation is complete and easy to understand.

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