ISO^® 20022 Overview and Implementation Details Frequently Asked Questions

ISO 20022 Overview

1. What is ISO 20022?

   ISO refers to the International Organization for Standardization, which is a network of national standards bodies that develop international standards. ISO publishes standards for a broad range of industries. The United States is a member of and contributor to ISO standards for the financial industry through the Accredited Standards Committee X9–Financial Industry Standards, Inc.

   The ISO 20022 standard supports financial messaging and uses extensible markup language (XML) syntax. ISO 20022 messages use a common data dictionary, can carry a considerable amount of information, and can support payment messages from end to end, including the following:

   • Payment initiation (corporate to bank)
   • Interbank settlement (bank to bank)
   • Cash management (bank to corporate)

    

   The ISO 20022 standard is being adopted by an increasing number of the world’s payments, clearing, and settlement systems, including European countries, Japan, Switzerland, and India, and has attracted growing interest from financial institutions, corporations, and financial applications providers.

2. Where can I learn about ISO 20022?

   The Business Payments Coalition (Off-site) has three publications, provided below, to help people learn more about ISO 20022. The BPC is an industry group of organizations and individuals working to promote adoption of electronic business-to-business (B2B) payments, remittance data, and invoices.

   1. Understanding ISO 20022 Resource Guide (2017) (Off-site, PDF)
      This guide is a compilation of existing resources that provide information on the ISO 20022 standard, including tools that help with transitioning to the new standard such as mapping tools and implementation guides.
   2. U.S. Adoption of ISO 20022 (2017) (Off-site, PDF)
      This white paper is a companion document to the Understanding ISO 20022 Resource Guide and provides evidence of U.S. adoption of ISO 20022 for corporate to bank payment operations.
   3. ISO 2002 in Plain English (Off-site, PDF)
      This is the presentation from webinar “Overview of ISO 20022: A Business Framework Discussion,” which covered the basics of ISO 20022 explained in plain language.

    
3. What is a SWIFT Message Type? Is that the same as or different than the ISO 20022 message format?

   SWIFT Message Types (MTs) are the formats used to send messages on the SWIFT network to financial institutions. SWIFT MTs are different than ISO 20022 message formats, although there are certain similarities. SWIFT MTs were developed by SWIFT but incorporated into an ISO standard, ISO 15022. ISO 20022 is a new standard based in large part on the ISO 15022 standard but uses XML as its syntax.

4. Can you provide an example of the ISO 20022 format?

   The following example uses the address fields to illustrate one difference between the current Fedwire Funds Service proprietary message format and the ISO 20022 format.

   Fedwire Funds Service	ISO 20022
   For each party field in a message, the Fedwire Funds Service format contains three free-text lines for address information:	The ISO 20022 format uses XML syntax and contains discrete fields designed to contain specific address information, which makes it easier to identify components of the address (e.g., country code):
   Address Line 1 (up to 35 characters) Address Line 2 (up to 35 characters) Address Line 3 (up to 35 characters)	Postal Address <PstlAdr> <AdrTp> (4 characters) <Dept> (up to 70 characters) <SubDept> (up to 70 characters) <StrtNm> (up to 70 characters) <BldgNb> (up to 16 characters) <PstCd> (up to 16 characters) <TwnNm> (up to 35 characters) <CtrySubDvsn> (up to 35 characters) <Ctry> (2 characters)

5. Can you provide some use cases to illustrate the potential benefits of the ISO 20022 format?

   In 2016, the Federal Reserve Banks presented a webinar, which includes use cases. It can be accessed directly at:

   • ISO 20022 Use Cases for U.S. Wire Transfer Systems Webinar (Off-site)

   A presentation deck used in the webinar can be accessed directly at:

   • ISO 20022 Use Cases for U.S. Wire Transfer Systems Webinar Presentation (Off-site, PDF)

    

Fedwire Funds Service ISO 20022 Implementation

1. Why are the Federal Reserve Banks implementing ISO 20022 payment messages for the Fedwire Funds Service?

   The Federal Reserve Banks’ adoption of ISO 20022 messages for the Fedwire Funds Service is a strategic imperative. We believe modernizing the Fedwire Funds Service’s message format is a sound investment in the future. Adopting the ISO 20022 message standard should help the Federal Reserve Banks meet increasing customer demands for richer data, help customers more easily comply with evolving regulatory requirements, improve the Fedwire Funds Service’s interoperability with other payment systems in the interconnected, global economy, and help customers enhance their client services. The table below outlines several strategic reasons to adopt ISO 20022 messages for the Fedwire Funds Service.

   Strategic Reasons to Adopt ISO 20022

   Reason	Description
   Provides richer data	The ISO 20022 format contains structured fields to support longer names and specific address components, including a country code, which could reduce the risk of data loss and might improve the regulatory screening process. The ISO 20022 format supports a structured format for extended remittance information, which could improve straight-through processing for corporate business-to-business payments.
   Promotes domestic & cross-border interoperability	A common format facilitates transacting domestically and globally by using a single, open standard rather than multiple proprietary standards, which require mapping and can be costly and cumbersome for banks, corporates and vendors. The ISO 20022 format contains fields that are common across the suite of ISO 20022 payment messages so that the same information can be carried from end to end of a funds transfer, which could increase accuracy and straight-through processing and reduce operating costs for all customers. Other payments markets, including those of key U.S. trading partners, now use ISO 20022 (e.g., Europe, Canada, United Kingdom, Bangladesh, Brunei, China, India, Japan, Switzerland).
   Provides opportunities to improve existing processes or add new services	Moving to a common global format could: Reduce the need for market practices that arise due to inconsistent formats and field and/or message capacity limitations. Improve extended remittance information capabilities. Support value-added services (e.g., payment tracking and prioritization, administrative and reporting functions).
   U.S. payment systems could fall behind the rest of the world and be perceived as “outdated”	Lack of ISO 20022 adoption could: Degrade the U.S. dollar’s leadership as a global settlement currency. Encourage migration of U.S. dollar clearing offshore, to other currencies, or to emerging payment systems built with new technologies.

2. How will the Fedwire Funds Service change as a result of implementing the ISO 20022 messaging standard?

   The Federal Reserve Banks will implement ISO 20022 messages for both domestic and cross-border funds transfers, as well as all other inputs and outputs, from the Fedwire Funds Service (i.e., all message types, inquiries, reports).

   The Fedwire Funds Service’s ISO 20022 implementation also will include enhancements based on customer feedback, including new fields for additional persons or entities identified in payment messages; purpose codes to help explain the business purpose of funds transfers; and structured address components, including a country code.

   With the ISO 20022 implementation, the Federal Reserve Banks will sunset the existing proprietary Fedwire Application Interface Manual (FAIM) format and replace all FAIM messages with ISO 20022 messages.

3. Will the ISO 20022 implementation also apply to the Fedwire Securities Service or the FedACH^® Service?

   No, the Federal Reserve Banks are not implementing ISO 20022 messages for the Fedwire Securities Service or the FedACH Service. ISO 20022 messages are being implemented only for the Fedwire Funds Service and the FedNow^® Service.

4. How will the Federal Reserve Banks migrate the Fedwire Funds Service to the ISO 20022 format and what is the implementation date?

   On June 27, 2022, the Board of Governors of the Federal Reserve System (Board) announced (Off-site) in a Federal Register notice (Off-site) that the Federal Reserve Banks will adopt the ISO 20022 message format for the Fedwire Funds Service in a single-day implementation strategy on March 10, 2025.

5. How did the Board determine the implementation date?

   The Board determined the March 10, 2025 implementation date based on feedback received in response to the Federal Register notice (Off-site) published in October 2021. Such feedback included:

   • Avoid implementing the ISO 20022 message format close to a U.S. banking holiday, during the winter holiday season (which also generally coincides with many firms’ annual technology freeze periods), or at the end of a calendar month or quarter.
   • Provide a gap between the July 2023 launch of the FedNow Service and the Fedwire Funds Service ISO 20022 implementation.
   • Allow additional time for industry testing of ISO 20022 messages.
6. Will there be an opportunity to begin sending ISO 20022 messages before the migration on March 10, 2025?

   The Fedwire Funds Service will not support ISO 20022 messages until the opening of the funds transfer business day on March 10, 2025 (9:00 p.m. ET on Sunday, March 9, 2025).

7. Does the ISO 20022 implementation delay for the CHIPS^® system have an impact on the Fedwire Funds Service ISO 20022 implementation?

   On February 9, 2023, The Clearing House issued a press release (Off-site) to announce that the CHIPS system will reschedule its ISO 20022 implementation from November 2023 to April 2024. The Fedwire Funds Service remains on schedule to implement ISO 20022 messages on March 10, 2025.

8. What do I need to do to prepare for the Fedwire Funds Service’s implementation of ISO 20022 messages?

   The extent of your preparations will largely depend on:

   • How much technology you have integrated with the processing of your outgoing and incoming Fedwire Funds Service messages
   • The degree to which you perform your own software development
   • The degree to which you rely on service providers and/or software vendors to provide an interface to the Fedwire Funds Service

    

   You can also refer to the Fedwire ISO 20022 Preparedness Checklist provided on the Fedwire Funds Service ISO 20022 Implementation Center.

9. What is the impact of the ISO 20022 implementation on my institution?

   The table below shows how particular types of Fedwire Funds Service customers (or their service providers) will be affected by the ISO 20022 implementation.

   Type of Fedwire Funds Service Customers	Impact of ISO 20022 Implementation
   Fedwire Funds Service customers and service providers that access the service via the FedLine Direct® solution	Customers and service providers may need to make (or may need to ensure their service providers make) significant changes to their payment applications or processes so they can send and receive messages in the ISO 20002 message formats. This group will need to obtain the ISO 20022 format specification documents, which will outline the changes needed to accommodate the ISO 20022 format for the Fedwire Funds Service. These documents are available on MyStandards® website. Note: If your institution works with a vendor but that vendor is not listed on our vendor page, please contact us.
   Fedwire Funds Service customers that use the Import/Export feature of FedPayments® Manager – Funds over the FedLine Advantage® solution	Customers may need to make significant changes to their payment applications or processes so they can import and export files with ISO 20022-formatted messages. This group will need to obtain the ISO 20022 format specification documents, which will outline the changes needed to accommodate the ISO 20022 format for the Fedwire Funds Service. These documents are available on the MyStandards website. Note: If your institution works with a vendor but that vendor is not listed on our vendor page, please contact us.
   Fedwire Funds Service customers that manually create messages directly in FedPayments Manager–Funds (accessed through the FedLine Advantage solution)	The Federal Reserve Banks will make the necessary changes to the FedPayments Manager — Funds application and provide training on enhanced features. This group will need to become familiar with the look and feel of the updated application and enhanced features. Some customers that manually create messages but use the export feature to download their messages may need to make changes to their processes (e.g., for OFAC scanning, for saving messages to archives). Note: If your institution works with a vendor but that vendor is not listed on our vendor page, please contact us.
   Fedwire Funds Service participants that use the offline service	Participants’ current process for submitting messages to the offline service will not materially change. There may be marginal changes around the type of information Wholesale Operations Site operators collect by telephone, as well as the order in which they collect the information, based on the new message format.

10. What is the difference between the ISO 20022 implementation for the Fedwire Funds Service and the FedNow Service?

    While both the Fedwire Funds Service and the FedNow Service plan to use the ISO 20022 message format, the ISO 20022 standards implementation for these services are separate initiatives. As a brand-new system, the FedNow Service will leverage ISO 20022 messages from the outset, whereas the Fedwire Funds Service must replace its current proprietary message format with ISO 20022 messages.

    The Federal Reserve Banks plan to align implementation of the ISO 20022 message format for the FedNow Service and the Fedwire Funds Service to the greatest extent possible, though there will be some differences in how the ISO 20022 message format is implemented for these services. For example, the Fedwire Funds Service will not adopt a request for information feature planned for the FedNow Service so that Fedwire Funds Service customers do not receive new types of messages.

    The Federal Reserve Banks published ISO 20022 message specifications for the FedNow Service and Fedwire Funds Service on the MyStandards website. Users can use the comparison feature to identify the differences between the ISO 20022 messages for the FedNow Service and the comparable ISO 20022 messages for the Fedwire Funds Service.

11. Will the ISO 20022 implementation have an impact on the speed in which the Fedwire Funds Service processes transactions?

    No. The Fedwire Funds Service will continue to process messages at the same processing speed as it does today.

12. How will retrievals be supported when the new ISO 20022 format is implemented?

    For users of FedPayments Manager – Funds application via the FedLine Advantage solution:

    Fedwire Funds Service customers will continue to be able to retrieve past messages from the prior 15 months. Each past message will be formatted in the version in which it was created and will display as such upon retrieval.

    For users of the FedLine Direct solution:

    The Federal Reserve Banks will not support prior-day retrieval requests after cutover to ISO 20022 message format. Fedwire Funds Service customers and service providers will be able to retrieve messages in the ISO 20022 message format only. For example, if ISO 20022 message format goes live on a Monday:

    • On Monday, can only retrieve ISO 20022 messages from the current day (Monday)
    • On Tuesday, can retrieve ISO 20022 messages from current day (Tuesday) and only 1 prior business day (Monday)
    • On Wednesday, can retrieve ISO 20022 messages from current day (Wednesday) and 2 prior business days (Monday and Tuesday)
    • On Thursday, can retrieve ISO 20022 messages from current day (Thursday) and 2 prior business days (Tuesday and Wednesday)

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