The P27 migration process: a big opportunity

P27 News speaks with Robert Pehrson, SEB’s Head of Products and Business Development in Transaction Services, about banks’ P27 migration preparations, ISO 20022, and how the platform may be a prerequisite for digitalization.

Robert Pehrson is no stranger to P27, having been involved since the start when SEB helped launch the initiative along with five other leading banks in the Nordics.

“I’m an old timer by now,” he says with a laugh.

Indeed, the prospect of seamless, cross-border, multi-currency payments across the Nordics puts a smile on Pehrson’s face. However, he’s quick to point out that adapting to an expected post-P27 world is very serious business for SEB and other banks in the Nordics.

“P27 is a prerequisite for the digitalization journey not only for individual banks but for the whole business ecosystem, including ERP vendors, service providers, and other parties,” he says.

“To stay relevant, we need to do this.”

P27 migration planning: a beneficial journey

Pehrson, who also serves on the P27 Advisory Board, believes banks should already have a well-defined migration project underway as P27’s expected launch draws ever closer. In addition, banks in Sweden need a concrete plan for how to deliver for the milestones set up by the Transformation Committee at the Swedish Bankers’ Association.

He also believes the expected arrival of P27 presents a “big opportunity” for SEB and other banks to streamline internal processes, reduce complexities, and rethink how they interact with customers.

“At the same time, it’s a tough commitment towards the market where everyone needs to deliver,” he adds.

“We need to prove to future customers this expected migration is a beneficial journey for them, and we need to take them by the hand and show them what’s involved.”

While banks focus on reducing complexity internally and guiding their own customers through the migration process, P27 is working together with the Nordic Payments Council to help get rulebooks aligned.

Building momentum for change

However, P27’s main focus is delivering a robust and secure payments platform in line with expectations. But that also entails sharing information with other stakeholders and supporting the transformation for the entire community (subject to competition law requirements), says Pehrson.

“It’s really about building momentum for change, and that’s something we all need to support,” he adds.

Exactly how P27 may impact banks’ payments business very much depends on how banks choose to implement P27 capabilities into their offering, says Pehrson.

“But for all banks it will mean a more simplified, robust, and competitive payment business. That’s why we’re doing this,” he adds.

The expected arrival of P27 will also help banks accelerate the adoption of the ISO 20022 global standard for financial messaging upon which P27 is built.

“There’s a global transformation taking place where local standards with different formats are being replaced by one standard and common format,” says Pehrson.

Getting the whole community involved

Pehrson believes potential larger corporate customers will likely welcome the expected arrival of an ISO 20022-aligned P27 payments platform as many are eager to have as many transactions as possible covered by the ISO standard.

“They will be easy to convince,” he says.

But the transition may present a change for small companies who are more dependent on ERP vendors when it comes to knowledge and competence. Thus, banks and P27 also need to work closely with ERPs to help them prepare for the platform’s expected launch.

“If we don’t get the whole community involved, we won’t be able to reap the full benefits of the transition to a new payments platform,” he says.

“After all, strong payments capabilities that work in real time, 24/7 are the foundation of a functioning digital economy. That’s the expectation banks need to meet. And that’s why we need a strong platform provider like P27.”

Note: The official launch of P27 services is subject to regulatory approvals and therefore P27 will not conduct any business activities until required regulatory approvals are obtained.