The Evolution of the Payment Systems
Gianfranco Guidolin, International Business Development
Romanian Banking Forum 2002Bucharest, 19 November 2002
European Financial ScenarioMain Drivers
New forces are driving the evolution of the European Financial Market:
Economic integration
Introduction of the Euro
Harmonisation of existing domestic infrastructures
Financial market infrastructure consolidation
Euro means:
thanks to• price transparency • transaction cost reduction• common rules and legislation• use of standards (IBAN, BIC)
European Financial ScenarioEconomic Integration and Introduction of the Euro
IntegrationCompetition
European Financial ScenarioFinancial market infrastructure consolidation
Consolidation means:•harmonisation•facilitation of cross border transactions•clearing and settlement cost reduction•trading as a commodity•greater competition•efficiency
– less fragmentation– clearing and settlement integration– standards
DomesticPaymentSystems
NationalCommunicatio
nStandards
LocalOrganisational
Solutions
Need for Payment System Harmonisation
•Integration of domestic and cross-border payment infrastructures
•Same costs for both domestic and pan-European transactions
•Reduction of clearing and settlement cycle time•Fair and open access
European Financial ScenarioSEPA (Single Euro Payment Area)
Security in the Financial World
Security is a common threadthroughout the financial world
FinancialServices
InterbankingCompanies
Banks
Users
SECURITY
• Strategic approach to security:
integrated global solutions
instead of single product/service
solutions
• Co-ordination between physical
and IT security
• From IT security to business
security
• Non repudiation ever increasing
importance as market
dimensions grow
SECURITY IS A STRATEGIC ISSUE
The key framework to support the evolutionary process
Up-to-date, competitive enabling infrastructures: the foundation on which the re-
engineering process must be built ensuring efficiency, effectiveness and security
INNOVATION INTEGRATION
FINANCIALMARKET
SecuritySecurity
Since 1977 SIA is the main service provider for
Italian financial Institutions, Banks and
financial Operators
A competitive offering based on innovative, secure and integrated technology
Data Base NetworkingInfrastructure
ServicesApplication
ServicesFront End
SIA: 25 years of expertise
Value and innovation for the financial
market
Düsseldorf
New York
London
Frankfurt
Paris
Amsterdam
Madrid
BaselTokyo
Lisbon
Athens
RUPA
SIAnet
The SIA Network
The central infrastructure for all financial services with the highest levels of security and reliability:
• SIAnet delivers all the financial transactions to national and international members of the financial community
• Satellite infrastructure to deliver information to financial markets• Open multi-protocol architecture in optical fibre (wide-band MPLS)• Over 3,600 billion bytes transported with SLA higher than 99,999% in 2001
• First Italian company certified BS7799, Vision 2000
• Charter member of the Global Trust Authority
• First Certification Authority recognised by AIPA
• SIA designs, develops and manages critical services with a help desk for 24x7x365 guaranteeing high service availability levels
A complete and competitive offering for all security needs
Our commitment
• SIA Group:
• Strategic Partnership:
SIA: Security Excellence
Security
Payment systems
SIA manages the Italian payment system services:
Retail Payment Clearing Subsystem
&
Wholesale Payment System Exchange Procedures
Clearing & SettlementPre-settlement
Payment Management
PaymentInitiation
Pre-settlementPaymentSystem
TicklerGuaranteesValidation
Datacollection
Payment Value Chain
Claering &Settlement
Step2 is aimed at processing high volumes of commercial and retail payments sent to the system through a secure
network
EBA STEP2 is a pan-European answer to banks needs for retail payments:
A recent international successSEPA - EBA (Euro Banking Association)
EURO1
TARGET
A nB
Settling DirectBank B
IndirectBank 2
IndirectBank 1
Settling DirectBank A
EBASTEP2
SIA is the leading IT providerfor the entire value-chain of the financial markets processes
Info collection& distribution
OrderCollection &routing
Marketaccess
Matchingengine
Data dissemination
Italian Stock Exchange
Equities, Derivatives, Treasury and Corporate Bonds
MTS, EuroMTS, MTS Japan, MID
TradeImpact - A T S
Information andAccess MarketsMarkets
TradingOnLine
Trading Mngt
Financial Info
Monitor
Global order routingSWIFT ETC
Service Provider
WebtradeWebtrade
Trading on-line
Markets and Access to Trading
Trading technology
IT outsourcing servicesAn attractive option
SIA’s outsourcing offers a reliable approach to addressing the challenges ahead.
SIA has already created a Win-Win Relationship with:
Monte TitoliTLX
eMID
CCG
BorsaItalian
a
Banca Profilo
Banca d’Itali
a
Euroyard
MTS
SIA: your reliable partner
Revenues: € 200 million (+10 %)
Net Profit: € 6,4 million (+22 %)
Italian clients: over 1000
International Clients: over 300 (+ 20%)
Infrastructure investments: € 47 million
Figures in 2001
SIA chosen by the EBA as the technology partner to build and operate the new pan-European Automated Clearing House for mass payments in Euro
Most recent success
www.sia.it ABE EBA
SIA provides competitive, innovative and secure IT solutions thanks to the right combination of technical
expertise, vertical know-how and cost efficiency