The software provider Proffix implemented the new ISO 20022 message formats as part of a pilot project with PostFinance. In an interview, CEO Peter Herger discusses the most important objectives and findings for Proffix, and offers some advice.
Our main aim was to produce a customer-friendly solution
Ever since the initial discussions on the harmonization of payment transactions, Proffix CEO Peter Herger has been aware of the importance of this topic for software manufacturers. "The changes affect the whole process of exchanging information with financial institutions. Right through from the traditional transfer of payments to account movements that are scanned into the software, not forgetting incoming payments and direct debit schemes", he explains. "And as a software provider, we play a key role in these processes."
The ISO 20022 formats implemented
For this reason, he did not hesitate when PostFinance suggested that he should take part in the pilot project for the implementation of the new ISO 20022 formats. The project comprised several stages and involved implementing the following ISO 20022 message formats:
- For transfers, the two pain.001 formats for transfer orders, and pain.002 for error and status reports
- With regard to notifications and account statements, the camt.053 message formats for account statements, and camt.054 for debit and credit advices
- Concerning debits, the pain.008 format (Debit Direct from PostFinance will be replaced by the new Swiss Direct Debit scheme, or CH-DD for short)
The main objective
Proffix approached the subject and the implementation one step at a time. Peter Herger had a single objective constantly in mind: to meet the needs of Proffix customers. "We want to make the changeover as easy as possible for the users of our products. As they did not ask for these modifications to be made, no significant additional effort should be required as a result", he explains. One of the aims was to avoid non-scheduled releases, for example. Thanks to extremely strict project management, Proffix succeeded in incorporating all the changes associated with the new ISO 20022 formats in the usual three releases that the software provider makes available to its customers each year. "Since March 2012, each release has included ISO 20022-relevant modifications."
The most useful instruments
The project for the implementation of the new message formats was carried out in close collaboration with PostFinance and with the help of various instruments provided by the financial institution. "The ISO 20022 rules are quite overwhelming. PostFinance made excellent documentation available for each stage of the process – with easily understandable manuals that were a great help to us during implementation", explains Peter Herger. The PostFinance test platform is another vital instrument. "We used it to simulate all the migrations and put them through vigorous tests on proper PostFinance accounts until everything worked perfectly", explains Herger. Unexpected problems arose in the process. "Transactions suddenly started being entered twice during tests, for example. To solve the problem, we had to adapt our software so that it would recognize double transactions." Thanks to the thorough testing, Proffix is now as sure as it can be that the implemented formats will function just as smoothly for its customers.
The most important lesson learned
At Proffix, the software adaptations in connection with the new message formats are complete for the time being. "The actual project continues however", emphasizes Herger. After the implementation, it took a great deal of dedication to persuade users to work with the new message formats and to download the relevant versions. This was the most important lesson learned from the project. Proffix provides users with a range of customer information that explains which message formats they can use with which version and what they need to do beforehand. "Again, the main aim was to make things as easy as possible for the customers". For payment orders, for example, all the customer has to do is activate the “Use ISO 20022 XML format” option in the settings of the Proffix accounts receivable software. For ISR reconciliation and downloading account movements, no changes need to be made in the software at all. Customers must however inform PostFinance that they want to start using ISO 20022 for this type of data exchange. Customers who want to work with CH-DD ISO 20022 need an appropriate contract with PostFinance in addition to the latest version of Proffix.
Advice to other software providers
What advice would Peter Herger give to all software providers who still need to implement the new message formats? As well as focussing on customer requirements, it makes sense to proceed in stages. It is advisable to gain experience in one area before moving on to the next step. "Strict project management and optimum coordination are also particularly important", he adds. The success of the project also depends on good communication. Within the company, for example, he constantly endeavoured to anticipate and answer potential questions from employees. "I was able to reassure our customer service that additional support would not be necessary due to the changes, for instance."
Conclusion and next steps
The implementation project went very well for Proffix. The software is ready for ISO 20022 and a positive conclusion can therefore be drawn. "This is partly due to the good working relationship with
PostFinance", concludes Herger. The topic remains very much on the agenda, however. For one thing, the customers now need to switch to the new Proffix versions. There are also other financial institutions on the list. "Every bank we connect is different. We were not expecting this, and we will continue to deal with the issue for some time."
Peter Herger is the CEO of Proffix Software AG
Proffix Software AG is a Swiss software company with 17 employees. The company, which is based in Wangs in St. Gallen and has a subsidiary in Wetzikon (Canton of Zurich), offers modular business software for SMEs. Proffix implemented the new ISO 20022 message formats as part of a pilot project initiated by PostFinance.