Navigating the ISO 20022 Implementation Roadmap

Advice & Guidance for Financial Institutions & Corporates

ISO 20022 is the new language of payments – a global financial messaging standard designed to streamline and modernise financial transactions. By providing a common language for communication between financial institutions, it will drastically improve efficiency, reduce costs, and bolster security against financial crime.

But for all the inherent advantages, implementation is proving to be a challenge for many. Much of this is due to a lack of centralised information from the ISO Technical Committee, along with the myriad ways that banks are interpreting the new rules.

That’s why, in this article, we’re going to show you how to navigate the ISO 20022 roadmap – so that you can get compliant in time and gain a competitive advantage over the thousands of businesses that will inevitably miss the deadline.

The ISO 20022 Roadmap

The global implementation of ISO 20022 will be gradual, likely to stretch well into the next decade. The only payment system we have dates for at the moment is CHAPS, which is following this ISO 20022 implementation timeline:

1. From May 2025: the use of Purpose Codes for CHAPS payments between financial institutions, and for property transactions; and the inclusion of LEIs for CHAPS payments between financial institutions will become mandatory.
2. From November 2026: CHAPS payments must use Structured Addresses in hybrid form, at a minimum. Any CHAPS payments containing fully unstructured addresses will be rejected.
3. From November 2027: CHAPS payments must use Structured Remittances. Any unstructured remittance data included in payment files will be rejected.

If you were to send a CHAPS payment with only an unstructured address from November 2026 onwards, I’m afraid it just would not pass validation. That’s hard rejection for your payments.

Tanveer Bhatti | Lead Policy Analyst at Bank of England

 
You may also have seen different dates to the above, which could be for two reasons:

But whether you’re getting ready for your very first ISO 20022 project, or your tenth, the high-level transition roadmap for successful compliance remains the same:

1. Preparation: Assess your existing systems and processes to identify gaps and determine the necessary changes to comply with ISO 20022.
2. Coexistence: You’ll launch ISO 20022 and run it alongside the legacy messaging standards. This allows for a gradual transition, gets users familiar with the new language, and minimises the disruption caused by a full-fledged switchover.
3. Full Adoption: Once your users are ready, your systems have been optimised, and your processes changed you will adopt ISO 20022 fully for a given payment.

It’s very important to speak to your bank. You need to understand exactly where they’d like you to put the new data, and every bank will have its own process for this. My biggest piece of advice is to start now.

Anish Kapoor | CEO at AccessPay

Major payment systems adopting ISO 20022

Whilst CHAPS is the only published deadline we have to work with, several major payment systems around the world have committed adopting ISO 20022. This includes:

Additionally, many other regional and national payment systems are implementing ISO 20022 to ensure interoperability and facilitate cross-border transactions.

Key ISO 20022 challenges to prepare for

There’s no denying that ISO 20022 is a big change – which means it also comes with some big challenges. There are four main considerations for you to prepare for:

Technical: Integrating ISO 20022 with all existing systems and processes can be complex and time-consuming – some will need to be changed, and some replaced altogether.

Financial: The initial investment in new technology and infrastructure may be significant, and you will likely need to bring in additional expertise at cost – especially if you’re on a short deadline.

Skills: Ensuring that staff members are adequately trained and equipped to handle the new standard is essential – to avoid payments being rejected for lack of compliance.

Interoperability: Different banks will require different information in different ways, and other financial institutions and payment systems may still be using legacy standards once you’ve transitioned to ISO 20022. This will need careful management to ensure that all the systems in your payments process can properly communicate with one another.

ISO 20022 phase-by-phase guidance

Best practices for implementation

Early assessment and planning

1. Identify Existing Systems and Processes: Conduct a thorough assessment of your current financial messaging systems, including payment systems, core banking systems, and other relevant applications. Evaluate their compatibility with ISO 20022 and identify any gaps or limitations.
2. Define Scope and Objectives: Clearly define the scope of your ISO 20022 implementation, including the specific messages and processes you intend to migrate. Set clear objectives and expected outcomes to guide your project.
3. Develop a Detailed Implementation Plan: Create a comprehensive plan outlining the key tasks, timelines, resources, and responsibilities involved in the implementation process. Prepare for the big changes you’re going to have to make – like budget, staffing, and new ways of working.

Stakeholder engagement

1. Identify Key Stakeholders: Identify all relevant stakeholders within your organisation, including IT, finance, operations, compliance, and risk management teams.
2. Communicate the Benefits of ISO 20022: Clearly articulate the advantages of adopting ISO 20022, especially improved efficiency and reduced costs. Speak to their pain points.
3. Address Concerns and Questions: Proactively address any concerns or questions from stakeholders, providing them with accurate information and reassurance.

Technology infrastructure upgrades

1. Evaluate Existing Infrastructure: Assess your current technology infrastructure – hardware, software, and network – to determine if it meets the requirements of ISO 20022.
2. Upgrade or Replace Systems: If necessary, invest in new or upgraded systems to ensure compatibility with ISO 20022. Scalability, security, and integration capabilities are the most important things to consider.
3. Implement Data Migration Strategies: Develop strategies for migrating existing data to the new ISO 20022-compliant systems, ensuring data accuracy and integrity.

Testing and validation

1. Develop a Comprehensive Testing Plan: Create a detailed testing plan that covers all aspects of your implementation, including functional testing, non-functional testing, and security testing.
2. Conduct Pilot Testing: Conduct pilot tests to identify and address any issues or challenges before full-scale implementation.
3. Validate Integration with Third Parties: Ensure that your systems can seamlessly integrate with other financial institutions and payment processors that have adopted ISO 20022.

The benefits of adopting ISO 20022 pre-deadline

• Competitive Advantages: Gain a competitive edge by being among the first to adopt ISO 20022. This can lead to improved customer satisfaction, reduced operational costs, and enhanced market reputation.
• Improved Operational Efficiency: ISO 20022 can streamline processes, reduce manual intervention, and improve data accuracy. This can lead to increased productivity and cost savings.
• Enhanced Data Insights: ISO 20022 provides a standardised data format that enables better data analytics and reporting. This can help you make informed business decisions and identify areas for improvement.

AccessPay’s role in ISO 20022 migration

For all intents and purposes, our payments platform is a shortcut to ISO 20022 compliance. We understand the deadlines, the processes, and the requirements – and we’ve built them into our systems.

That means that if you’re using ISO 20022 to make payments, it’s essentially impossible to enter anything that isn’t ISO 20022 compliant – so if AccessPay accepts your payment, so will your bank, your partners, and all other financial institutions.
We can also support you with your own independent transition:

• Read our new eBook: The Practical Guide to ISO 20022
• Follow our 10-step action plan for full compliance
• Visit the ISO 20022 Resource Hub and watch our video series

The future of ISO 20022

As more organisations adopt ISO 20022, the financial industry will become more interconnected, better protected, and highly efficient. Whilst it might feel like a necessary evil now, it will inevitably lead to greater opportunities for innovation and collaboration. It’s a lot of hard work, but it is objectively leading towards a much brighter future for UK and world finance.

Conclusion

ISO 20022 is one of the biggest advancements in the financial industry for decades, offering countless benefits including improved efficiency, reduced costs, and enhanced risk management.

For those who embrace it and get ahead of the game, it will make their lives easier and the flow of business smoother. For those who drag their feet, it will become a time-sensitive burden that jeopardises their operations.

To avoid getting caught in the net and to realise the benefits sooner than your competitors, start your ISO 20022 project today.