Update on Fedwire® Funds Service ISO 20022 Implementation Date
May 24, 2022
In October 2021, the Board of Governors of the Federal Reserve System (Board) announced (Off-site) in a Federal Register notice (Off-site) (October 2021 Notice) that the Federal Reserve Banks (Reserve Banks) will adopt the ISO 20022 message format for the Fedwire Funds Service. The Board also sought input on a proposal to migrate the Fedwire Funds Service to the ISO 20022 message format on a single day, targeted for no earlier than November 2023, rather than in three separate phases, as previously proposed. The comment period closed on January 4, 2022. The Board received 60 comments(Off-site) in response to the Notice, and is currently in the process of reviewing these comments.
The Reserve Banks plan to recommend to the Board that the implementation date be later than November 2023. In developing a revised implementation date to propose to the Board, the Reserve Banks are considering industry feedback from the October 2021 Notice, which suggested the following:
- The implementation date should not be:
- close to a U.S. banking holiday;
- during the winter holiday season (which also generally coincides with many firms’ annual freeze periods for significant technology changes); or,
- at the end of a calendar month or quarter.
- There should be a gap between the 2023 launch of the FedNowSM Service and the ISO 20022 implementation for the Fedwire Funds Service.
- The Reserve Banks should provide at least one year for industry testing of the ISO 20022 messages.
The Reserve Banks are also collaborating with The Clearing House Payments Company L.L.C., operator of the CHIPS® system, to explore a potential staggered implementation approach to mitigate the risk of two large-value systems implementing a significant change on the same day.
In light of these developments, Fedwire Funds Service participants should prepare for the possibility that the ISO 20022 implementation date will be during the first quarter of 2025. The Board will announce the final implementation date in a future Federal Register notice.
The Reserve Banks will publish the final ISO 20022 message format specifications for the Fedwire Funds Service on MyStandards® by mid-summer 2022.