A recent survey conducted by Intix shows that many European banks are struggling to meet the upcoming EU deadlines for mandatory instant credit transfers. The research examined the banking sector’s preparedness for compliance with ISO 20022 standards and the EU’s Instant Payments Regulation, set to take effect in January 2025 for receiving transactions and October 2025 for sending them.
Key Findings:
- Only 33% of respondents reported they are fully prepared for the EU’s instant payment deadlines.
- 41% stated they are nearly ready but face specific limitations, while 25% are not prepared at all.
Main Challenges:
- The top concern for banks is compliance with sanction screening, Anti-Money Laundering (AML) regulations, and fraud detection protocols, including Verification of Payee checks.
- Banks are also struggling to meet the 10-second, 24/7 service level agreement (SLA) required for instant payments, along with managing a higher volume of transactions.
These findings underscore the significant hurdles banks are facing in adopting real-time payment capabilities while ensuring regulatory compliance. With the deadlines approaching, the pressure is mounting for banks to upgrade their processes and technologies to meet these demands.
Investment Priorities:
The survey also highlighted banks’ investment strategies:
- 42% of banks are dedicating most of their budgets to regulatory compliance.
- 33% are focused on adapting their payment engines to handle instant payments.
Compliance Approaches:
Regarding sanction screening and fraud detection:
- 42% of banks plan to use a combination of pre-screening, real-time, and post-screening measures.
- 25% are opting for a mix of pre-screening and real-time screening, while only 17% rely solely on real-time methods.
Adoption of ISO 20022:
- 50% of banks are still in the process of adopting the ISO 20022 standard.
- 40% have already made it their primary standard, while only 8% have no experience with it, indicating its growing prominence in the financial sector.
As instant payment regulations loom closer, the survey highlights the urgent need for modern solutions that help banks manage transactions efficiently while ensuring compliance and customer satisfaction. Platforms like Intix offer banks the tools to monitor, track, and report all transactions from a single interface, making the transition smoother and more manageable.
This shift toward real-time payments is driving the industry to prioritize innovation in payment infrastructure and compliance, paving the way for a more agile, secure banking environment.
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