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Overview of the Most Important Industry Standards for the Banking Industry

The banking industry has invested heavily in information technology and generally banks are quite sophisticated in their use of IT. However, when it comes to standardization and industrialization of systems and processes inside a bank, well, the industry lags behind its counterparts. As a result, banks are not always able to integrate systems, bring on new technology, or adapt to business change as easily as they would like.

Industry standards have already defined the foundation for business process interoperability in the banking industry, particularly with respect to the exchange of funds with other banks or financial networks. However, there is a clear lack of standardization between systems within the banks themselves. Industry standards define a common business language, which is required to cost-effectively enable business process integration between systems. Standards have and can enable business process flexibility by providing concrete rules for integration that have been developed by representatives of the banking community. SAP has deep domain experience in building solutions for the Banking industry and has worked with numerous industry standards organizations to advance business semantics to enable more efficient business processes and to maximize supply chain flexibility.

The following organizations produce standards or will produce standards that SAP customers in the Banking industry may find useful in enabling business processes between applications.


UNIFI is the ISO 20022 UNIversal Financial Industry message scheme. It describes a model-driven process for defining electronic finance messages and provides a repository where messages defined according to the process can be registered. Most if not all of the standards bodies in the finance industry are using or planning use the UNIFI process to define standards.

The IST Harmonization group (ISTH) - a consortium of finance standards bodies and banks that enlisted the assistance of SAP - used UNIFI to define and register a set of electronic payment messages for the exchange of financial payments between companies and banks. SAP is implementing these payment standards in mySAP ERP. The objective of the UNIFI-based payment standards is to simplify the initiation of electronic payments for ERP users and to promote straight through processing of payments once they have been initiated. If adopted broadly, these electronic payment standards could fundamentally change the way money moves in the global financial supply chain.

It is important to emphasize, however, that UNIFI is not only about electronic payments. It is also being used to define finance standards for purchase orders, pre- and post-shipment financing, invoicing, securities trading, currency exchange, and more.

ISO TC68 (Financial Services Technical Committee) / WG4 (ISO 20022 Technical Expert Group)

TC68 is a technical committee within the International Standards Organization (ISO) focusing on standardization in the field of banking, securities and other financial services. WG4 focuses on the development of ISO 20022 that defines UNIFI - the UNIversal Financial Industry message scheme.

Industry Value Network for Banking

In 2005, SAP was approached by a number of banks to discuss the challenges of interoperability, particularly with respect to front office business processes where internally developed applications dominate many large banking operations. An initial working group was created by SAP and a number of banks, service and technology partners that included ABN Amro, Credit Suisse, Deutsche Postbank, ING, Standard Bank and many others. The working group was challenged with defining a standard approach to enterprise Service Oriented Architecture (SOA) for banking business processes. Specifically, the goal was to define services in the emerging banking application landscape such that internally developed software and commercial-off-the-software could both be leveraged by banks to deliver maximum flexibility at the lowest possible cost.

Since it was launched, the effort has evolved into a broad collaborative initiative called the SAP Industry Value Network (IVN) for Banks. Today, the IVN for Banks has more than 130 members from 36 financial institutions as well as software, service and technology providers. The IVN for Banks first defined a comprehensive architectural framework for defining services and then created a number of work groups to address specific service topics such as client reporting, credit risk, loans management and risk management.

The final phase is to transition the IVN for Banks to not-for-profit organization, incorporated out of Frankfurt, called the Banking Industry Architecture Network (BIAN). This new non-profit standards organization will continue the work of the IVN for Banks but under the mantle of a public, open standards body. BIAN will have the same objective as the IVN for Banks, however, the additional mission of BIAN is to address the lack of standardization necessary to resolve the widespread integration challenges. BIAN will be officially launched in the first quarter of 2008 by many of the members of the Banking IVN and will build on the foundational work produced in the IVN for Banks.


SWIFT is a co-operative established by and for the financial industry that provides secure, standardized messaging services and interface software to over 8,100 financial institutions in 208 countries and territories. SWIFT members include banks, broker-dealers and investment managers. While it is a private organization, in many ways, SWIFT is the acknowledged leader in international standards-setting for the financial industry.

SWIFT operates a value-added network that enables its banks and other financial institutions to exchange messages, particularly with respect to the movement of money or securities. The purpose of the network is to automate and standardize financial transactions, thereby lowering costs, reducing operational risk and eliminating inefficiencies from banking business operations. The SWIFT network provides a range of end-to-end solutions covering many aspects of financial services processing including payments and cash management, treasury and derivatives, trade services, securities trading, pre-settlement, clearing and settlement and custody services.

OMG Finance Domain Task Force   

The Object Management Group (OMG) is the primary creator of standards for model-driven systems and has promulgated a suite of modeling and metadata standards under the rubric of Model Driven Architecture (MDA). Model-driven approaches to software development are crucial for Enterprise SOA. SAP supports the core MDA standards UML, MOF, XMI, and CWM, and the related JMI standard. SAP's Composite Application Framework (CAF) and the Business Intelligence SDK use MOF, XMI, and JMI for metadata management and the Business Intelligence SDK uses CWM as well.

The mission of the OMG Finance Domain Task Force (DTF) is to promote the use of Financial Services and Accounting software that incorporate OMG standards; to provide an internationally recognized forum for industry focus on Financial Services and Accounting Facilities; to identify relevant standards, business architectures, research and technologies in this area of computing and to assist and advise the OMG regarding its relationship with related standards organizations and consortia.

XBRL - Extensible Business Reporting Language 

XBRL is a language for the electronic communication of business and financial data which is changing business reporting around the world. Companies use XBRL to save costs and streamline their processes for collecting and reporting financial information. Consumers of financial data, including investors, analysts, financial institutions and regulators, can receive, find, compare and analyze data much more rapidly and efficiently if it is in XBRL format.

On February 3, 2005, the Security and Exchange Commission (SEC) adopted rule amendments formally establishing the XBRL Voluntary Program. This new program allows for the voluntary submission of XBRL documents as exhibits to certain periodic reports and investment company act filings. For now, this is a voluntary program. XBRL defines how to "tag" different kinds of data in financial reports, the information companies file with the SEC can be made much easier to find and analyze. For example, specific items in a financial statement, such as net income or gross sales, are given computer-readable labels. At the same time, the task of preparing the reports can be automated for the companies who file them.


The Open Applications Group (OAGi) is a not-for-profit open standards organization that defines process-based XML standards call Business Objects Documents (BODs) that span both B2B and A2A integration scenarios. The Open Applications Group was formed in late 1994 as one of the first post-EDI organizations focusing on improving the state of application integration. The adoption of OAGi specifications is primarily in North America however there is emerging adoption in the European Union and Asia. OAGi is a member of the IST Harmonization group in UNIFI which seeks to standardize the area of electronic payments.

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