Hi Payments folks, as you know the world of payments is evolving day by day, so the messagaing part which derives the content and details of particular transaction is also evolving now from MT to MX. In this article we will dig deeper to MT103 vs Pacs.008 message in MX, MT103 to Pacs.008 Field Mapping. It is a transition from SWIFT MT to ISO20022.
But What does this means for financial institutions and businesses? Lets explore
What is MT103?
MT103 is Swift standardized message which is used for the international payments. It is one the MESSAGE TYPE message of swift network which introduced in 1970s and serves as a “Single Customer Credit Transfer” message. Essentially, it is a structured message format used by financial institutions to process and settle cross-border payments for their customers.
Features:-
i) Mt103 Message provide all the basic or necessary info to facilitate a payment transfer.
ii) Being an ISO 15022 message, MT103 follows a globally recognized format, making it easier for banks and financial institutions to interpret the data.
iii) It contains info about the sender, receiver, payment amount, currency, charges and other details as well as.
Structure of MT103:
An MT103 message(SSCT) contains multiple fields including:-
- Field 20: Transaction reference number.
- Field 32A: Value date, currency, and payment amount.
- Field 50: Ordering customer (Sender, ordering customer, payer).
- Field 59: Beneficiary customer (Receiver, payee).
- Field 71A: Details of charges (ex- who bears the charges – SHA, OUR, BEN).
What is Pacs.008?
Pacs.008 or Payment Clearing and Settlement Message 008 is a message type which standardized under the ISO 20022. It is equivalent to MT103 message in MT. It is used for financial transactions in modern payment systems, specifically for processing individual customer credit transfers. Pacs.008 is an XML based message. All the information will be available in XML tags only. This message type is widely also adopted in real-time gross settlement (RTGS) systems and instant payment schemes globally.
Key Features of Pacs.008
i) pacs.008 is used to facilitate customer-to-customer credit transfers between financial institutions.
ii) Unlike the older SWIFT MT messages (like MT103), pacs.008 follows the XML-based ISO 20022 standard, which is more flexible and detailed.
iii) It allows for more structured and granular data, such as additional payment details, remittance information, and enhanced transparency.
iv) More richer data will be available in MX messages so that it will help in many ways like AML, KYC etc.
Structure of pacs.008:-
Group Header:- Contains basic info about the message like creation time, sender bank details.
Payment Information:- Payments method, amount, currency.
Creditor and Debtor Details:- contains all the information about sender and receiver, including address of town name, and very basic details like building number etc.
Remittance Information:- Contains remittance info like purpose or additional information.
Key Difference in MT 103 vs Pacs.008 Message
| Aspect | MT103 | pacs.008 |
|---|---|---|
| Standard | SWIFT (MT) | ISO 20022 |
| Data Structure | Text-based | XML-based |
| Field Enrichment | Limited | Rich, structured data |
| Purpose | Customer credit transfers | Customer credit transfers |
| Compliance Support | Basic | Advanced (AML, KYC) |
Read More- Difference Between MT and MX messages Explained
Mapping MT103 to pacs.008 Fields
Below are field mapping from MT 103 message to Pacs.008 field in MX.
| MT103 Field | pacs.008 Equivalent Field | Description |
|---|---|---|
| Field 20: Transaction Reference Number | <GrpHdr><MsgId> | Unique message identifier |
| Field 23B: Bank Operation Code | <PmtTpInf><LclInstrm> | Specifies the type of transaction |
| Field 32A: Value Date, Currency, Amount | <CdtTrfTxInf><IntrBkSttlmAmt> | Payment value date, currency, and amount |
| Field 50A/50K: Ordering Customer | <Dbtr> & <DbtrAcct> | Debtor’s details, including account information |
| Field 52A: Ordering Institution | <DbtrAgt> | Debtor’s financial institution (bank) |
| Field 59: Beneficiary Customer | <Cdtr> & <CdtrAcct> | Creditor’s details, including account information |
| Field 57A: Intermediary Bank | <IntrmyAgt1> or <IntrmyAgt2> | Details of the intermediary banks, if applicable |
| Field 71A: Details of Charges | <ChrgBr> | Specifies who bears the charges (SHA, OUR, BEN) |
| Field 72: Sender to Receiver Information | <RmtInf><Ustrd> | Unstructured remittance information |
How ISO MT to MX Migration will Help Financial Institutions?
There are various reason why a fintech must thik for ISO 20022 migration otherwise they will leave behind in many terms. Given below are the benefits for migration from MT to MX.
1. Improved Data Quality and Enrichment – It will help in KYC, AML, Fraud detection etc.
2. Enhanced Interoperability Across Systems- It enable easily connection between other financial systems.
3. Increased Efficiency and Automation- STP case more, means human intervention will be less.
4. Scalability for Future Growth- XML version will also good for future as it can adopt to new services very easily
5. Cost Savings in the Long Run- More richer data, reduced maintenance cost, fewer errors and much more
6. Better Customer Experience- Faster payments, track the payments easily, transparency.
Read More- Difference Between MT and MX messages Explained
Conclusion
If you look at closely, you will the debate is not about MT vs MX or not a comparison, its a payment industry transformation over the years. Of course, this migration will open the new doors for the new future for payment industry with transparency, richer data and much more.