Payment transactions with XML

When data is exchanged between customers and banks or within the banks, this is done utilizing standardized XML messages. This ongoing process of international standardization of payment messages is based on ISO 20022.

XML structure overview

The in Austria exchanged data between customers and banks is transmitted in a file, whose logical structure consists of several layers. The message header contains metadata necessary for the exchange, which does not contain any payment transaction data relevant for accounting.

Among it is the data to be transferred, first the top level, which combines several individual transactions into a whole, followed by the individual levels, which contain the individual transactions belonging to the whole.

What is ISO 20022?

ISO 20022, also known as the UNIFI standard (UNIversal Financial Industry message scheme) is a standard that aims to achieve worldwide convergence of existing and new message standards from various areas of finance. For the development of messages, ISO 20022 provides a platform that defines a unified development and modeling process of messages. This means that messages are developed in standardization organizations such as SWIFT (Society for Worldwide Interbank Financial Telecommunication)  and adopted as a globally valid standard under ISO 20022.

ISO 20022 not only relates to messages of payment transactions but also includes other business areas such as securities, foreign trade finance, and treasury.

Why ISO 20022?

There are a large number of standardization organizations around the world that have set themselves the goal of developing uniform standards for communication between different parties. These organizations’ work is important and necessary but harbors the risk of ultimately many standards existing in parallel and interoperability and thus the capability to automate data cannot be guaranteed. ISO 20022 has addressed this issue and now enables the development of financial messages on a common platform using a defined modeling approach.

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