Since 2016 International Banking communication has changed dramatically and will likely never be the same again. What worked 12 months ago will likely never work again!
Banking has embraced a form of Artificial Intelligence (AI) and this is now the ‘backbone’ of most banking – untouched by human hand!
Internationally, all funds and instrument undertakings are issued and received via the SWIFT Network.
Until about two years ago, they would be printed out on arrival and dealt with by the Supervisor in the SWIFT Department who would then forward them to the appropriate Department/Officer. Today, AI decides whether it will Accept or Reject the incoming SWIFT and only Accepted Instruments or Instructions are passed on for action.
Over the past two years we have seen multiple issuances recorded as being sent and received that have not been activated by the Receiving Bank.
The reason why is clear!
Once received, AI assesses each Instrument against the International Rules for such Instrument, such as ICC Rules for Standby Letters of Credit. If it does not comply in ALL respects it is rejected without reference to a Bank Officer! – Rejection = Deleted!
All transactions of any European bank are accessible by the European Central Bank. All transactions of any US bank are accessible by the Fed.
Ledger Transfers (as generally used for PoF) are also now clearly visible and accessible via AI to the Central Bank and no longer permitted without cash or cash equivalent (securities) pledged to that account for the duration of the Term, in order for the Bank to issue a verification of account.
This means that Bank Fees are due and payable up front with no exceptions!
Anyone that claims they can issue an instrument without pre-payment by the Client is either:
- Paying the fee on behalf of the Client; or
- Being cavalier with the truth.