payments 2013 conference april 23, 2013 in san diego, ca
TRANSCRIPT
Leveraging the New Balance & Reporting Standard
What you Need to Know about BTRS
Timothy JohnsonCash Express Svc Delivery SMEFIS Global
James Wills Senior Business MgrSWIFT
David RepkingInformation Reporting Prod MgrJ. P. Morgan Chase
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Welcome to PAYMENTS 2013
PAYMENTS 2013 Mobile App: Check-in on the mobile app. Download: ddut.ch/PAYMENTSWiFi: Complimentary Internet access is available via the PAYMENTS2013 network, password: WesternUnionCECs: Most sessions count toward continuing AAP accreditation. Learn more about becoming an AAP at the NACHA and RPA booth in the exhibit hall.PAYMENTS 2014: Register today to receive PAYMENTS 2013 early-bird rates for PAYMENTS 2014. Visit the registration desk for more details.Join the Conversation on Twitter: @NACHA_PAYMENTS #PAYMENTS2013
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From this session you will learn:
1.A Vendor’s Perspective of BAI2 Challenges
2.How BTRS was Formulated
3.Key Elements of the new BTRS Standard
4.The BTRS Implementation Process for Banks and Companies
5.Various Tools Available from the X9 Organization
Objectives
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Data Interchange History and Challenges Chronology
• 1965: Holland-America Steamship Line used telex messages to transmit shipping manifest that were then converted for use as computer input. Considered the first EDI (Electronic Data Interchange) †
• 1973: FTP Protocol Published †
• 1975: Treasury Management Services – Balance Reporting (BALDIS format) Multi Bank Reporting processing.
• 1980: BAI1 – Bank Administration Institute publishes the Cash Management Balance Reporting Specification , Version 1 †‡
• 1987: BAI2 is published †‡
• 2001: BAI2 final official update. Shortly after this release the standard is considered self-sustaining and is no longer actively supported or updated. †
• 2008: Bank Administration Institute transfers copyright ownership of the BAI format to Accredited Standards Committee x9, Inc. BAI established as an American National Standard. †
† source: Wikipedia (http://en.wikipedia.org/wiki/BAI_(file_format)‡ source: BAI (http://www.bai.org/about-bai/reporting-codes.aspx)
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Data Interchange History and Challenges A vendor’s perspective of Multi-bank Reporting
• Multi-bank defined
• The wild, wild west of Information Reporting– 900 series Custom Type Codes– Mixed formats– Proprietary formats– Inaccuracy of Data
BTRS addresses all these issues
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1.BAI2 Copyright Transferred to Accredited Standards Committee X9, Inc. in 2008
2.AFP Survey Administered in April 2010 by David Bellinger
3.Responses from 1,116 Corporates concluded:a) Payments industry has evolved to the point where BAI2 is no longer effectiveb) Customization has resulted in large disparities between banks
– Inconsistent formats, syntax and transaction codes– Too many similar BAI codes– Too many unused codes
c) Very difficult to automate the data importation to internal systems
4. BTRS Formulated & Approved by ANSI (2010 – 2012)
5. BTRS Now Replaces BAI2 as the Industry Standard
6. ASC X9 to announce future sunset date for BAI2
Balance and Transaction Reporting Standard (BTRS)History
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The Accredited Standards Committee X9 has the mission to develop, establish, maintain, and promote standards for the Financial Services Industry.
X9 BAI2 Standards Lead Jim Wills, SWIFT
BAI Codes Update Chair David Repking, J.P. MorganCo-Chair Greg Malosh, Bank of NY Mellon
Language of the Standard Chair John Scully, Bank of AmericaCo-chair Bill Lundeen , Proctor and Gamble
Wire Remittance Structure Chair Gina Russo, Federal Reserve BankCo-Chair Susan Colles, Bank of America
X9 Workgroups
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Changes include:
1. User Guide Modernized to include developments in banking and technology over the past 25 years
2. Rationalization and Reduction of the number of supported transaction codes
3. Globalization:
– Additional SEPA transaction codes to support new European payment types
– Double byte character set support through the incorporation of UTF-8
– SWIFT and ISO 20022 XML interoperability – Code Mapping and Balance Inclusions
– Modified currency rules to make them mandatory and allow for multi-currency
4. New batch level (89) and invoice level (90) records providing additional information using ISO 20022 component tags to assist in reconciliation and straight through processing
5. Additional structure to 88 record to support extended wire remittance in CTP payments
The New BTRSA Foundational Release
The Balance and Transaction Reporting Standard (BTRS) is intended to increase standardization of and improve upon BAI2
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The New BTRS Highlights
1. What does NOT change– Syntax – No new positional fields– 88, 49, 98, 99 Records (Hash totals)
2. File Header Record (01)– 1 = BAI1, 2 = BAI2, and 3 = BTRS
3. Account Record (03)– Modernized the list of Status and Summary Codes – Core Balance fields and the Currency Code field are now required– Inclusion of total credits and total debits are now required
4. Detail Record (16)– Modernized the list of Detail Transaction Codes– Eliminated Funds Type “D” (Distributed Availability) – use Funds Type “S”– Created New Batch 89 and Invoice 90 Record Types– Instituted a new Standard format for Wire Remittance CTP (aligned with ISO field names)
Goal: BTRS is as backward-compatible to BAI2 as possible!
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The New BTRS Status & Summary Codes
Type Code Status Code Descriptions ISO Family ISO Sub-Family SWIFT Current
DayPriorDay
010 Opening Ledger OPBD OpeningBooked :60F: YES015 Closing Ledger CLBD ClosingBooked :62F: YES020 Average Closing Ledger MTD 025 Average Closing Ledger YTD 030 Current Ledger ITBD InterimBooked :62M: Yes 035 Opening Available OPAV OpeningAvailable :65: 040 Opening Available Next Business Day FWAV ForwardAvailable :65: 045 Closing Available CLAV ClosingAvailable :64: YES050 Average Closing Available MTD 055 Average Closing Available YTD 057 Investment Sweep Position 060 Current Available ITAV InterimAvailable :65: YES
Status Codes1. 28 Codes Deleted
2. Opening Available (035) = Balance on the date reported
3. CD & PD Required Balances
4. ISO & SWIFT Interoperability
Summary Codes1. 92 Codes Deleted
2. 1 Summary Code per Detail
3. Record 03, always include– 100 Total CR & 400 Total DR
4. Globalization– “Float” to “Available”
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The New BTRS ACH Detail Codes
Comparison of
BAI2 vs BTRS
ACH Codes
Green = BTRS
Red = Obsolete
Type Code BAI2 Description BTRS141 ACH SEPA Transfer142 ACH Credit Received use 165143 Item in ACH Deposit use new 89/90 records145 ACH Concentration Credit use 165/166164 Corporate Trade Payment Credit use 165/166165 Preauthorized ACH Credit ACH Received166 ACH Settlement ACH Originated Settlement
168 ACH Return Item or Adjustment Settlement
ACH Originated Settlement - Return
169 Miscellaneous ACH Credit ACH Miscellaneous257 Individual ACH Return Item ACH Received - Return 441 ACH SEPA Transfer445 ACH Concentration Debit use 455/466447 ACH Disbursement Funding Debit use 466451 ACH Debit Received use 455455 Preauthorized ACH Debit ACH Received464 Corporate Trade Payment Debit use 455/466 466 ACH Settlement ACH Originated Settlement
468 ACH Return Item or Adjustment Settlement
ACH Originated Settlement - Return
469 Miscellaneous ACH Debit ACH Miscellaneous557 Individual ACH Return Item ACH Received - Return
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The New BTRS ACH Detail Codes
Type Detail Code
Summary Code
Description ISO
DomainISO
FamilyISO Sub-
FamilySWIFT
CR 169 140 ACH Miscellaneous PMNT RCDT ATXN DDTDB 469 450 ACH Miscellaneous PMNT ICDT ATXN DDTCR 166 167 ACH Originated Settlement PMNT RCDT ASET STODB 466 450 ACH Originated Settlement PMNT ICDT ASET STO CR 168 167 ACH Originated Settlement - Return PMNT ICDT ARET RTI DB 468 467 ACH Originated Settlement - Return PMNT RCDT ARET RTI CR 165 140 ACH Received PMNT RCDT ACDT DDTDB 455 450 ACH Received PMNT ICDT ADBT DDTCR 257 256 ACH Received - Return PMNT ICDT ARET RTI DB 557 450 ACH Received - Return PMNT RCDT ARET RTI CR 141 140 ACH SEPA Transfer PMNT ICDT ESCT STO DR 441 450 ACH SEPA Transfer PMNT ICDT ESDD STO
110 Codes DeletedGlobalization– Added SEPA Codes– Local Language (UTF8 – e.g., Chinese)
Normalization– Full, Clear set of codes– 1 Summary Code Assigned to each Detail Code (1:1)– Interoperability between BTRS, ISO & SWIFT
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Step 1: Request the new code via X9 Website.
The New BTRS What if I need a new Code?
Step 2: If urgently required, use 900 series codes until X9 assigns a new code.
By instituting BTRS under “Continuous Maintenance”, changes are readily adopted.
15The New BTRS New Batch and Invoice Reporting Record Codes
Requirement: Indicate the items within a batch with associated invoices
Challenge:Double-reporting!
Solution:Insert items as a continuation of Transaction Detail
– 89 Batch Detail– 90 Invoice Detail
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Batch Record 89 Allows you to insert information about the items within a batch.Your Bank will need to include the 89 Record in your BTRS file and you will need to parse & load them
The New BTRS New Batch and Invoice Reporting Record Codes
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Implementing the New StandardA vendor’s perspective of Multi-bank Reporting
A Phased BTRS Implementation Approach
1. Conversion of BAI1 and/or BAI2 to BTRS for Balance Reporting to Corporate Customers (outbound)
2. Conversion of BAI1 and/or BAI2 to BTRS for large scale FI Processing
3. SWIFT MT conversion to BTRS
4. Receipt and Processing of BTRS formatted files (inbound)
5. BTRS for Corporate Customers and FI utilizing XML file structures and format (inbound and outbound)
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The New BTRS Simplifying the Implementation Process
Moving to the BTRS Standard is a coordinated effort by both Banks and Companies
1. Banks should:– Begin to offer the BTRS format within 12-18 months– Remap deleted Detail Codes using the Technical Implementation Guide– Remap Summary Codes to the standard associated to each Detail Code– Provide only codes on the list (Request New codes via X9)
2. You should:– Visit the X9 Website to get your FREE copy of BTRS and to learn more– Determine the impact to you back-office system for the new BTRS Format– Ask your banks for their plans to upgrade from BAI2 to BTRS– Tell your banks YOUR requirements for upgrading
(Remember, you asked for these BTRS improvements!)
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Resources
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ResourcesBTRS is the New Face of BAI2
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Questions
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Tim Johnson, FIS Global [email protected]
Jim Wills, [email protected]
David Repking, J.P. Morgan [email protected]
Interested in attending a Webinar?Represent your Company on X9 BTRS Committees?
Give your Business Card to or email Tom, Jim or Dave