1. How SWIFT can help you with SEPA?
Vincent Questiaux
SEPA Program Manager
3rd SEPA Conference, Warsaw
October 2007

2. Agenda SEPA Testing Programme SWIFTNet Bulk Payments Solution
Interoperability support
Be ready for SEPA – SWIFT Training

3. SEPA Testing programmes for the EPC Testing phases
SAL IV
Bank-to-CSM-to-Bank …
CSM specific business & operational testing programmes
End-to-end operational testing programmes within and across
CSM communities
SAL III
Bank-to-CSM …
CSM specific business & operational testing programmes …
SAL II
Bank-to-Bank …
CSM specific business & operational testing programmes
Specific business & operational testing programmes
bilaterally agreed
SAL I
Bank internal
CSM internal …
CSM specific business & operational testing programmes
Bank or CSM internal Application testing programmes
Note: SAL stands for Self Assessment Level in the EPC SEPA Testing Framework

4. SEPA Testing programme is an initiative of the SEPA testing Advisory Group (STAG)
Dresdner Bank
Deutsche Bank
Fortis
Hypo VereinsBank
ING Bank
JPMorgan Chase
Natixis
Nordea
Intesa San Paolo
SEB
Société Générale
UBS
ABN Amro
Bank of America
Bank Austria Creditanstalt
Banco Bilbao, Vizcaya Argentaria (BBVA)
Banco Popular Español
Banco Santander Central Hispano
Caisse Nationale des Caisses d’Epargne
CitiGroup
Commerzbank
Credit Mutuel (CIC)
Created at SIBOS 06, the STAG provide advice and guidance to develop the SEPA Testing Programme
Seceti

5. A common SEPA Testing Programme to support SEPA Standards Compliance testing
EPC Testing phases
SAL IV
Bank-to-CSM-to-Bank …
CSM specific business & operational testing programmes
End-to-end operational testing programmes within and across
CSM communities
SAL III
Bank-to-CSM …
CSM specific business & operational testing programmes
SAL II
Bank-to-Bank …
CSM specific business & operational testing programmes
Specific business & operational testing programmes
bilaterally agreed
SAL I
Bank internal
CSM internal
ISO Standard
rules testing
Testing EPC
rules
for SEPA
Testing CSM
Market
Practices
File exchange
headers
Testing

6. Cooperation agreement between the CSMs and SWIFT
VocaLink
Equens
STET
EuroSIC
Dias
Seceti
SIBS
IberPay
SEPA Standards internal testing (SAL I), complementing banks and ACH’s operational and business end-to-end testing testing (SAL II to IV)
Common testing tools reduces the cost of testing the SEPA Core Service with each different partner
Single facilities provided by a neutral 3rd party
Reduce the inconsistencies between implementations and the operational risks
Facilitates the interoperability at the SEPA core service level within an SEPA community and across communities
Testing at own pace : no window
Reduce testing programmes overlap and promote interoperability with their members

7. Bank/CSM Testing with the CSMs and with the SEPA Testing Programme
SAL II
SAL III
Business and
Operational
Testing
Iberpay
specific
STET
specific ….
Equens
specific
SAL I
Bank internal
CSM internal
Non SEPA
Service Messages
AOS Standard
EPC SEPA Scheme rulebooks
and Implementation Guidelines V2.3 (TVS)
File Exchange
Headers
Standards under discussion
CSM Market
Practices
Standards submitted to the EPC for endorsement
Core SEPA Standard
EPC SEPA Scheme rulebooks
and Implementation Guidelines V2.3 (TVS)

8. SWIFT SEPA Testing Programme value proposition
Standards
Non SEPA
Service reports
CSM specific fields
Future
EPC SEPA Additional
Optional
Services (AOS)
Additional Optional Services (AOS) (White Fields)
Bulking SEPA
Messages
Standardised File exchange header
Release 1.x
SEPA CSM market
practice
CSM market practices
Core EPC SEPA
Schemes
Core SEPA (Yellow Fields)
Proprietary
messaging
CSM specific fields
Value
SEPA
AOS
compliance
Proprietary
protocol
Standardised
CSM
topologies
Core SEPA
Compliance
Messaging
Interoperability
Value added
services

9. Pragmatic testing approach with proven testing methodology
Testing strategy
Extensive coverage of EPC rules for SEPA
Testing the ability of the application to generate valid SEPA messages
Testing the robustness of the application to receive messages
Validation of more than one rule per test case, if possible
Specific CSM test cases roadmap
Structured testing methodology
Identification of logical and physical Test Cases (Word/XML files)
Decision tables and equivalence patitioning techniques, with value boundaries analysis
Any constraint on Core fields (“yellow” fields) in the EPC IG that overrules the ISO20022, i.e.:
Mandatory indication
Rules, i.e. “usage rules” , “format rules”
Number of occurrences
All valid code values
One invalid value.
The absence of at least one AOS fields (“white” fields) in a structured field
The absence of all non-SEPA fields (“red fields”)
Cross element rules
Optimised test cases to reduce the effort while offering the coverage required for the SEPA compliance certification

10. Simulation Test and Qualification Service for SEPA (STaQS)
A comprehensive and practical set of testing tools and services
SWIFTStandards
Smart Test Messages
Internal Application Testing
SEPA BICPlusIBAN &
Routing directories
Simulation Test and Qualification Service for SEPA (STaQS)
Standards Compliance Testing
SWIFTStandards Smart Test Messages for SEPA:
Samples of ready prefilled test messages with realistic business data for internal application testing
Simulation Testing and Qualification Service (STaQS) for SEPA
Central testing facility that plays the role of sparring partner able to exchange messages, execute scripted test cases based on EPC test scenarios and report on tests execution.
SWIFTNet messaging
Proven file transfer and light browsing messaging infrastructure
Reference data directories for SEPA:
Samples of BICPlusIBAN and SEPA routing directories BIC and IBAN relationships and clearing routing path information
Self-assessment communication
A Programme Management Office (PMO) which monitors the progress and reports the Self-Assessment compliance declaration.
Operational Readiness Testing
Bilateral
ACH

11. Positioning the testing tools of the SEPA Testing Programme
Smart Test Messages
Simulation Test & Qualification
Inbound message test only
Free self testing only
Customisable test data
Manual test execution
Test validation document
No connection needed
Hand-holdimg support
300+ messages
EPC Core Standard only
No file headers support
Useful test messages
for SEPA testing
Basic SEPA workflow (in & out)
Free/scripted test cases
Customisable test data
Scheduling test execution
Test results reporting
Connectivity (SN FileAct)
Hand-Holding Support
+350 Test Cases
EPC and CSM market practices
EBA file headers support
Mandatory set of test cases
for SEPA compliance

12. SEPA Testing Programme benefits The industry reference for testing SEPA core standards
Mitigate operational risk through extensive and optimised testing with high risk coverage level
Ensure “standard” interoperability by testing strictly the SEPA core standard with SWIFT as a neutral 3rd party, independent from any clearing channel.
Reduce the testing costs by testing the SEPA Standards compliance once with a programme that does not overlap with the CSM tests
Leverage existing investment with integrated testing tools that are easy to use
Test at your own pace thanks to services available 24/7d that allow standalone testing
As a neutral service, the programme represents the industry testing reference that ensures interoperability between all players for the core SEPA standards, independently of the clearing and settlement channel used
Consistent SEPA core standard testing approach
By working closely with all industry players, the EPC, the SEPA Testing Advisory Group (STAG), the European Banking Association (EBA), the European Automated Clearing House Association (EACHA), and most national automated clearing houses (ACHs), the programme guarantees strict compliance with the EPC SEPA standards and reduces the risk of divergent implementation behaviours
Ensure interoperability independently of the clearing channel
As a neutral service, the programme represents the industry testing reference that ensures interoperability between all players for the core SEPA standards, independently of the clearing and settlement channel used.
Employing accredited partners
SWIFT’s global partnering programme provides access to accredited vendors, consultants and application providers for our SEPA offering.
Support
Dedicated hand-holding support to eligible participants to assist them in their SEPA testing according to a practical roadmap
Single and integrated testing approach
Consistent, robust and interoperable implementation
Open to all
Aligned with EPC testing framework
Promotes consistent SEPA implementation
Reduces effort and cost at institution and industry levels
Comprehensive testing tools
Stand-alone
24h/24h and 7d/7d availability

13. SEPA Testing Programme Deliverables timeline
July 07
Aug-Sep 07
Oct 07
Future
Release 1.0/1.1 SCT
bank-to-bank
TVS and ISO
Directories
specifications
Release 1.1.2
EBA File Headers Enh.
ITB for Partners
Corporate-to-bank
AOS fields
File Headers
EPC rules
Release SCT
CSM Market Practices
EBA File Headers support
Release for
SDD
SN FileAct 6.1
= completed
= to be completed
157 early adopters registered (512 destinations) incl. 8 ACHs and 11 users start testing (Oct 07)

14. Agenda SEPA Testing Programme SWIFTNet Bulk Payments Solution
Interoperability support
Be ready for SEPA – SWIFT Training

15. The SWIFTNet Bulk Payments solution
SWIFTNet Bulk Payments is aiming at harmonising exchange of bulk payments, in order to decrease development costs and facilitate interoperability between payments systems
Standards 1
UNIFI ISO standards
SWIFTNet FileAct
SWIFTNet InterAct for single/urgent messages
Messaging 2
Promoting market best practices and increased harmonisation
Rulebook 3
Pricing 4
Price per payment leg

16. The SWIFTNet Bulk Payments solution - pricing
Price per payment instruction
Between 0.02 and 0.07 eurocent per payment instruction transported, which means between 1,430 and 5,000 payments for 1 Euro
Supporting different message formats without impact on prices
Independent from compression level, payment length and file size (min 100 payments/file)
Close to actual payment business model
Determined by
The annual volume of the community, closed user group of entities encompassing the same set of business rules and common standards to clear a single currency
The annual volume of the institution within the closed user group
Contributing to the calculation of the global tier of the financial institution

17. Agenda SEPA Testing Programme SWIFTNet Bulk Payments Solution
Interoperability support
Be ready for SEPA – SWIFT Training

18. Interoperability - components and issues
Cooperative space = business rules and standards
Business rules
Instrument def.
Rulebook
CSM Market Practices
Chosen syntax and version
Opt. Implementation Guidelines
Standards
“Competitive” space = implementation considerations
Infrastructure
Transport mechanisms and protocols
File header and structure
Exchange Payload Header

19. CSM Market Practices – status
STAG identified interoperability enabler
Provides topology based expected layout of defined SEPA XML core messages
Supplements the EPC Implementation Guidelines
Endorsed by and published as an EPC document
Slide 19

20. Exchange Payload Header - Status
Provides a generic solution and messaging layer-independent way of declaring the content of an exchange between parties and the structure of the exchange payload.
Common
Headers
Requirements
Common
Logical
Model
Service
Profiles Giovannini,
SEPA,
ETC…
Specifications
Service Profiles
Published on for public consultation. Next version available soon

21. Exchange payload headers – Status
published on for public consultation
deadline for comments set for 14th Sept
little feedback to date except from STET and EBA
Requests for further information received from inside SWIFT and some committed customers.
Next version will be issued based on the received
feedback.
Slide 21

22. SWIFTNet FileAct – Header Info implementation
To date, two profiles are defined…
Transaction count: allows automated pricing for Bulk Payments solution
Payment file summary: allows for confidentiality, authorisation, based on summary (risk management), audit trail, etc…
… but the solution remains flexible: additional fields can be added (and usually taken from the logical Exchange payload header model).

23. Agenda SEPA Testing Programme SWIFTNet Bulk Payments Solution
Interoperability support
Be ready for SEPA – SWIFT Training

24. Be ready for SEPA – what you need to know
How does SEPA impact your institution?
What is this new ISO XML standard?
How do I populate the SEPA XML credit transfer and direct debit messages?
What are the EPC implementation guidelines and rules relating to these messages?
How do these XML elements relate to the MT 103? ….

25. SWIFT Training offering Open classroom and customised, on-site courses
Available
Available
Jan 2008
Understanding SEPA
Using ISO standards for SEPA credit transfers
Receive detailed information on the ISO messages, flows, rules and guidelines
Learn how to correctly process the XML messages for SEPA credit transfers
Using ISO standards for SEPA direct debits
Receive detailed information on the ISO messages, flows, rules and guidelines
Learn how to correctly process the XML messages for SEPA direct debits
Receive a good general understanding about SEPA and what it means for your financial institution
Learn about SWIFT's several new offerings in the context of SEPA
For information and registration: