Swift and a group of banks, payment schemes and technology providers are working on a pay-by-alias model intended to make international transfers feel more like domestic instant payments.
The initiative would let consumers send money abroad using identifiers such as a mobile phone number, email address or virtual payment address instead of entering a recipient’s bank-account details, according to Swift’s September 28 announcement.
Participants include Australian Payments Plus, Commonwealth Bank of Australia, DBS, IDFC FIRST Bank, Banco de Credito del Peru, Banorte, BBVA, Bizum, Bradesco, CaixaBank, Citizens Bank, Ouribank, TerraPay and Veritran.
How the model would work
The proposed approach would connect familiar identifiers already held in domestic payment systems with international transactions carried over Swift. A sender could select a recipient through an alias, while the participating infrastructure would match that identifier to the appropriate account information.
Swift said the work draws on systems including Bizum in Spain, PayID in Australia and Pix in Brazil. Australian Payments Plus describes PayID as a mobile number, email address, Australian Business Number or organization identifier linked to a bank account. Domestic PayID transfers are initiated through a user’s bank rather than a separate consumer app.
For the cross-border project, participating institutions will need to address how aliases are resolved across jurisdictions, how customers are authenticated, and how banks meet privacy, fraud, sanctions-screening and other compliance requirements. Swift did not give a launch date, name initial payment corridors or say when customers would be able to use the service. The announcement therefore describes an industry initiative and proof-of-concept work, not a generally available product.
Building on a broader consumer-payments framework
The pay-by-alias project is the next phase of Swift’s consumer payments framework, which was introduced in June. Swift said more than 100 financial institutions are live or preparing to go live with that framework, which is designed to provide upfront information on costs and foreign-exchange rates as well as faster settlement.
Swift also said 75 percent of payments on its network reach the receiving bank within 10 minutes. That figure measures arrival at the beneficiary bank, not necessarily final credit to the customer’s account. Swift has separately reported that most journey time is often spent in the domestic last mile after a payment leaves its network.
The new initiative focuses on the front end of that journey by reducing the information a sender has to collect and enter. It is distinct from Swift’s blockchain-based ledger for tokenized deposits, although both efforts are part of the cooperative’s broader work on cross-border payments.
Swift says its network connects more than 12,500 institutions across 200 markets. The pay-by-alias work is intended to operate over that bank-led infrastructure rather than replace participating institutions’ customer channels or domestic instant-payment systems.
Asia-Pacific institutions join the initiative
Asia-Pacific participants include Australian Payments Plus, Commonwealth Bank of Australia, Singapore-headquartered DBS and India’s IDFC FIRST Bank. Their involvement gives the project access to institutions operating across domestic instant-payment environments and international banking networks.
Swift quoted Australian Payments Plus Chief Executive Lynn Kraus as saying the opportunity is to extend the simplicity Australians already associate with PayID to cross-border transfers. Swift did not disclose each participant’s technical role or whether all members will test direct connections between their domestic schemes.
The project comes as financial authorities continue to push for faster, cheaper, more transparent and more inclusive international payments. The Financial Stability Board’s cross-border payments program identifies speed, cost, access and transparency as the main challenges facing the market.
For Swift and its partners, the next test will be whether alias-based addressing can work across multiple regulatory regimes and payment systems without weakening the verification and compliance controls expected of international transfers.
Singapore banks complete live SGD tokenized-deposit transactions