There are few financial institutions as important to the global payments system as the network of domestic central banks. In Asia one of the boldest and most forward thinking is the Monetary Authority of Singapore (MAS).
In 2003, the MAS decided that it was looking to upgrade its current real time gross settlement system for domestic payments, which was called the MAS Electronic Payments System or MEPS.
The new central application was to be called MEPS+ and crucially within MEPS+, the MAS decided to include the messaging functions and network connectivity of SWIFTNet.
As the world gets more interconnected and global, so domestic payments systems need to be able to talk to each other. The beauty of the using SWIFTNets messaging and connectivity within the MEPS+ platform, is that although it is a domestic platform, it can talk to all the other international platforms. This puts the MAS in the same company as Germany's Bundesbank, the UK's Bank of England and the international CLS Bank, which is one of the largest payment agents in the world. Indeed by creating MEPS+, the MAS joins more than 50 global clearing systems, which each process up to 200,000 payments a day.
"With the new MEPS+ system using SWIFTNet, the advantage for the MAS is that it is now employing international messaging standards, which means it can talk to other banks easily," says Andrew Lai, regional manager at SWIFT in Singapore. "It can now plug into the global network of other real time gross settlement systems when it needs to."
For Singapore as a whole this will make the domestic payments system much more fluid and efficient. By tapping into the reliability and security of SWIFT, the MAS can transform the resilience and connectivity of its domestic payment system.
After three years of very hard work, the new MEPS+ system will be ready at the end of 2005. "We are certainly glad that the MAS has decided to go down the SWIFT path," says Lai. "It means they can very easily tap into many other regional or global initiatives."
