The synergy between ISO 20022 and cloud-native core banking

See how ISO 20022 and cloud-native core banking combine to break legacy barriers, enabling smarter, faster, and more interconnected financial services.

ISO 20022: A new era in financial data exchange 

This new standard is not just another messaging standard; it’s a comprehensive financial language. This global standard enables financial institutions to capture and exchange more granular data, which in turn helps to streamline payments, enhance cross-border transaction efficiency, and ensure better compliance with regulations. Its widespread adoption fosters a truly interconnected global financial system that enhances interoperability among different institutions. 

The legacy system challenge 

Legacy core banking systems, which were once seen as reliable, now face significant challenges in adapting to the enriched data environment created by ISO 20022. These outdated systems struggle to manage the complex data exchanges required by the new standard, hindering their ability to fully utilize enriched transaction details and gain deeper insights into customer behavior. 

Additionally, the standards’s emphasis on standardized messaging requires systems to be agile and flexible enough to adapt to the evolving financial landscape. Legacy platforms often lack this flexibility, leading to inefficiencies, particularly in cross-border transactions and when communicating with ISO 20022-compliant systems. 

Regulatory compliance also becomes a significant challenge. As regulations continue to evolve, financial institutions must keep pace with these changes to avoid risk. Unfortunately, legacy systems often struggle to adjust to new regulatory demands, resulting in potential compliance gaps. Furthermore, customer expectations for real-time and personalized services are constantly rising. Legacy systems may not meet these demands, potentially impacting customer satisfaction. 

The role of cloud-native core banking 

To fully harness the power of ISO 20022, financial institutions must move away from legacy systems and adopt cloud-native core banking solutions. Here’s why: 

• Enhanced Security Measures
  
  Data security is critical, and cloud-native solutions offer industry-leading protection. With robust encryption, threat detection, and secure cloud environments, these solutions safeguard sensitive ISO 20022 data from potential breaches and cyber threats. 
  
  
• Seamless Integration with the standard
  
  Cloud-native providers are designed to easily integrate with the standard through the use of APIs and microservices. This integration enhances the flow of data, streamlines processes, and ensures a more unified user experience. As a result, institutions can rapidly deploy updates and new features with minimal disruption. 
  
  
• Future-Proofing for Innovation and Customer-Centric Focus
  
  In the fast-paced financial world, staying ahead of emerging trends is key. Cloud-native solutions are adaptable and future-proof, making it easier for financial institutions to quickly adopt new technologies such as artificial intelligence and blockchain. This adaptability helps financial institutions focus on driving innovation and improving customer experience, offering personalized services that build loyalty and satisfaction. 
  
  
• Compliance and Regulatory Adherence
  
  Cloud-native providers are committed to helping institutions maintain regulatory compliance. By partnering with top-tier cloud service providers, these solutions meet the highest industry standards, ensuring that ISO 20022 data is securely stored and shared in accordance with all applicable regulations.