DNB Group extends utilization of XMLdation services to supercharge XML adoption by Norwegian enterprises

From within the Euro zone, it is easily overseen that the applicability of ISO20022 extends far beyond SEPA. Norway’s largest financial services provider DNB Group takes pride in leading their customers into the XML future. To further support customers’ XML on-boarding, the bank provides them with the XMLdation Validator also for non-Euro and cross-border payments, and recently added the XMLdation Simulator for customers to improve their account reporting process.

In Norway, national transactions in Norwegian kroner (NOK) and cross-border payments in non-Euro currencies can be executed in legacy formats far beyond the October 2016 SEPA deadline for Euro-denominated payments. Nonetheless, the country’s finance industry has long discovered the benefit of widely adopting ISO20022. The efficiency gain in the automated straight-through-reconciliation (STR) of XML payments is a major leap forward. Yet, it requires the seamless implementation of the bi-directional message flow, bringing along significant software testing needs.

Chris Pangopoulos, Vice President, Senior product manager for multinational payment solutions at DNB Group, explains the bank’s objective: “As the Norwegian national standards are available in XML we want to help our customers adopt XML for both customer-to-bank and bank-to-customer message flows”. The ISO20022 XML is also implemented in all DNB offices worldwide, offering our international customers a seamless communication with the bank.”

ISO20022 to provide full automation

DNB Group is now looking at ways to even the path towards utilizing the full range of benefits from ISO20022. Based on an assessment of customer needs, extending the coverage of the validation service to include non-Euro currencies and cross-border payments was an obvious step, as was the addition of the simulation service to the portfolio. “The decision to expand the co-operation with XMLdation was easy as we have successfully used XMLdation services for years,” Pangopoulos explicates.

As enterprises implement ISO 20022, the standard’s capability to improve the straight-through-reconciliation process is of great interest. Once payment status reports, account statements and credit/debit notifications between corporate and bank are in XML, the rich information enables to fully automate the reconciliation process.

STR requires extensive testing

“Testing a system to fully comply with XML messages received from the bank goes beyond the basic validation carried out on payment messages,” XMLdation Sales Manager Antti Kela explains: “For example in the case of payables, the financial software sends an ISO20022 credit transfer to the bank. It is easy to ensure the file compliance using our Validator. The challenging part is to automate the processing of account statements and debit notifications returned by the bank. This includes setting up the processing rules also for rejected transactions and the implementation of bank account reconciliation and matching process at ledger side.”

The XMLdation Simulator makes use of the bank’s XML definitions and gives customers an interface to test their XML message exchange against. 24/7 access to a simulation system allows enterprises to flexibly adjust their implementation, even testing a broad range of error situations or large batches of messages at once.

The simulation service sends back the exact response the bank’s production system would provide; it creates the needed account report formats having the same content as the customer’s payment files. This enables the customer to fully automate the bank account reconciliation and matching at ledger side.

Low maintenance, high value

DNB Group’s Pangopoulos is highly satisfied with the extension of the bank’s support offering: “The Simulator is running on the same system as the Validator we already used, which keeps the setup effort to a minimum while providing immediate value to our corporate customers. And once again the setup process was fast and XMLdation experts most competent”.

“Real-world testing without any interaction with our support organisation,” he highlights, “saves us a lot of time and money, not to speak of the productivity gain for our customers.

About DNB Group

DNB was established in 1822 and is today a leading financial institution in the Nordic banking market and a professional business partner to corporations who require a bank with both local and international competence. DNB is also the largest Norwegian bank, with more than 280.000 corporate clients and more than 2.6 million private clients, and we process a substantial amount of electronic transactions and payments.