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Finance transformed: ISO 20022 & cloud-native core banking in synergy

ISO 20022 and Cloud-Native Core Banking: Transforming Financial Services

In the world of financial standards, ISO 20022 is a game-changer, revolutionizing how financial data is exchanged on a global scale. This universal language for financial data exchange enriches data capabilities, offering financial institutions the tools to enhance customer insights, streamline cross-border transactions, and maintain regulatory compliance.

However, the real challenge lies in determining if legacy core banking systems can rise to meet the ISO 20022 challenge. Five Degrees‘s article delves into the ISO 20022 perspective and explains why financial institutions need to update their core banking systems to fully harness the potential of this global standard.

ISO 20022: A New Era in Financial Data Exchange

ISO 20022 isn’t just another standard; it’s the universal language for financial data exchange. With its enriched data capabilities, it enables financial institutions to gain deeper insights into transactions, streamline cross-border payments, and ensure regulatory compliance. ISO 20022 fosters seamless interoperability, creating a global financial language connecting institutions worldwide.

The Legacy System Challenge

Legacy core banking systems, once considered reliable, face limitations when dealing with the complexity of ISO 20022’s enriched data environment. These systems struggle with data exchange complexities, hindering their ability to capture, process, and fully utilize enriched data, which is crucial in today’s rapidly changing financial landscape.

Moreover, ISO 20022 emphasizes standardized messaging for global interoperability in financial transactions, but legacy systems often lack the flexibility to adapt to these standards. This results in operational inefficiencies, particularly in cross-border transactions and communication with ISO 20022-compliant systems.

From the ISO 20022 perspective, regulatory compliance is crucial. Financial institutions must swiftly adapt to evolving regulations to ensure compliance and prevent operational risks. Yet, legacy systems struggle to keep pace with these changes, leading to compliance gaps.

ISO 20022 also sets higher customer expectations for real-time, personalized services. However, legacy systems may not meet these expectations, potentially affecting customer satisfaction and loyalty.

The Role of Cloud-Native Core Banking

To harness the full power of ISO 20022, financial institutions should move away from legacy systems and adopt a cloud-native core banking provider, and here’s why:

  1. Enhanced Security Measures: Cloud-native core banking providers offer robust data security measures, safeguarding ISO 20022 data from cyber threats with encryption and threat detection.
  2. Seamless Integration with ISO 20022: These providers embrace APIs and microservices, enabling smooth integration of ISO 20022 capabilities with the core banking system. This approach streamlines data flows, fosters a unified user experience, and speeds up feature deployment.
  3. Future-Proofing for Innovation and Customer-Centric Focus: Cloud-native solutions excel in adaptability, allowing institutions to swiftly adopt future ISO 20022 updates and emerging technologies like blockchain and artificial intelligence. This fosters rapid deployment of new services and features, enhancing customer satisfaction and loyalty.
  4. Compliance and Regulatory Adherence: Cloud-native providers partner with leading cloud service providers to adhere to industry-leading compliance standards, ensuring data remains compliant with regulatory guidelines and ISO 20022 requirements.


The convergence of ISO 20022 with cloud-native core banking is transforming the financial industry. By embracing this transformation, institutions can unlock the full potential of enriched data, seamless transactions, compliance, innovation, and customer experiences. Updating legacy systems to align with ISO 20022 is a strategic leap toward redefining banking experiences, harnessing technology, and moving towards unrivaled possibilities in the dynamic financial landscape. Read full article here.

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