New data formats and the need for an EBICS update in Switzerland – what should be considered?

With the SIX EBICS V3.0 publication Swiss Market Practice Guidelines EBICS from June 2020, which contains recommendations for the implementation of the EBICS standard for the Swiss financial market, Switzerland is now also adapting the standard to the European harmonised protocol. The main drivers of the harmonisation were the members of the EBICS society, in particular the financial markets of Germany, France and Switzerland (the newest member is Austria).

By definition, two versions of EBICS are also supported in Switzerland, i.e. version 2.5 and version 3.0 in the future. At first glance, one could think that there is no urgent need for action on the part of customers and software manufacturers since the previous version is still being offered. If only in Switzerland the SIX document did not include the paragraph 2.2.1 EBICS Timeline with the following note: "To support the ISO 20022 schema migration to version 2019, the use of EBICS 3.0 is required."

As well-informed experts know, the ISO version 2019 is to be introduced for the customer-bank interface as of 2022. The current versions shall no longer be supported by 2024. This corresponds to the trend of global migration to this new version, e.g. in the projects SEPA, SWIFT MX or TARGET2 migration. This migration is of great importance, not least in view of the planned introduction of instant payments in Switzerland as of 2023.

The Swiss financial market has therefore decided to link the upgrade of the EBICS version with the upgrade of the ISO version. Against this background, customers and software manufacturers are faced with a few questions and challenges that should not be underestimated. The most important points are examined in the following paragraphs, and solutions are shown – wherever possible.

EBICS 3.0 will be available in Switzerland as of November 2021 at the latest

EBICS communication has now been fully established in Switzerland and is an indispensable part of the financial sector. So far, the EBICS version 2.5 is offered by the majority of financial institutions in Switzerland.

As already mentioned at the beginning, the Swiss Market Practice Guidelines EBICS (version 1.0 from 01/06/2020 by SIX, www.six-group.com) will officially introduce the new EBICS version 3.0 in Switzerland for corporate customer business with financial institutions as of November 2021.

Specifications by Switzerland for handling the new business transactions in EBICS

With the introduction of the new EBICS version 3.0, the previous version EBICS 2.5 will still be officially supported by financial institutions until the end of 2024. In addition, the acceptance of the new Swiss ISO 20020 formats in version 2019 requires EBICS 3.0. For corporate customers, this means that once they have updated their Swiss ISO formats, they can no longer easily use EBICS 2.5 for this purpose.

It is time to plan

These upcoming updates require that an adaptation of the software solutions be planned and implemented in good time. This is where financial institutions, corporate customers and software manufacturers must act.

Updating the ISO 20022 data formats to version 2019 is just one aspect. However, the changes to the EBICS protocol that are to be implemented with version 3.0 should not be underestimated. The most important requirements are:

• The new business transaction format (BTF) replaces the previous order types and FileFormat parameters.
• The transport of the public keys is now carried out uniformly with certificates.
• The cryptographic procedures are improved.
• The handling of bank keys is improved.
• There are additional control parameters for electronic signatures.
• A double submission check at file level is introduced.

So how to deal with these new requirements?

It is not only the financial institutions but also the software manufacturers of EBICS clients who have the task of extending their software solutions by EBICS 3.0, so that corporate customers can carry out updates and put them into production at an early stage.

All special features of EBICS 3.0 must be taken into account in the client, and it may be necessary to enable a mixed operation with different EBICS versions depending on the bank access and the EBICS users. In addition, the user should be offered migration options for the EBICS migration which avoid reinitialisation if possible (keyword increase of minimum key lengths).

The EBICS API – decoupling of business aspects and technology

From our own experience, we know that the migration to version 3.0 is not simply a matter of mapping order types to BTF combinations. There are many more challenges to overcome and aspects to reprogram respectively. This is especially the case if the financial institution, the software manufacturer and the customer want the migration to be as automated as possible. PPI has long been offering TRAVIC-EBICS-Kernel, an API solution for integration into proprietary EBICS clients. It is the central component for the handling of EBICS communication in almost every second EBICS client software in Europe.

With the latest version, the new specifics of EBICS 3.0 are, of course, already implemented. Correctly connected, the API transparently handles e-banking in all its variants and versions for the client. TRAVIC-EBICS-Kernel thus relieves the software manufacturers of e-banking and payments applications in the implementation of the standard protocol and its syntax as well as in security procedures. This solution fully reflects the EBICS specification and provides an easy-to-integrate interface that software manufacturers can connect to their software products as a convenient and quickly usable communication component.

Considering the cost/income ratio for the integration of TRAVIC-EBICS-Kernel, it is not surprising that this product is such a bestseller. Software manufacturers who do not use the TRAVIC-EBICS-Kernel can contact us at any time and request a test licence. The time for it has never been better than now, before the upcoming migration to EBICS 3.0.

Authors: Carsten Miehling and Michael Lembcke

Further information: Do you speak EBICS 3.0?

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Setting up EBICS – simply step by step

As a standard, EBICS offers maximum security for smooth European payment transactions. However, this also demands effort by all parties involved. The necessary initialisation and setup of bank accesses, EBICS users and rights requires careful configuration steps. To utilise the high potential of multi-banking, repeated steps must be performed which are usually distributed onto different places and executed in a decentralised manner. Reducing complex, networked applications to linear, simple sequences for business users is the art of designing user-oriented software.
The compact setup wizard that PPI has developed for its corporate customer portal TRAVIC-Port proves that this can be done conveniently, easily, and quickly. The target group is administrators on the customer side - because self-service is a key asset in modern customer-bank relationships. Allowing direct access to essential administration processes creates fast workflows without any detours to the provider.

Granted, if you want to create a new EBICS user, you will have to go through quite a few clicks; however, it is a purposefully guided, step-by-step process. The same is true for the PPI product world, i.e. TRAVIC-Port. The system requires from each individual user an ID, the master data, the initial password, and a security medium which will be used for login later on. On top of that, the user takes on different roles, has different authorisations and often more than one bank connection. As TRAVIC-Port is multi-bank capable, the respective bank accesses must also be set up. Often the main bank takes over this task for its EBICS corporate customers - and this usually means long phone calls during which the bank employee has to query all this information.

The user of the portal finds a new entry directly on the start page (see Fig. 1). This link can be used to go directly to the setup wizard and greatly facilitates the introduction to the secure world of EBICS. Via a series of dialogs, the wizard queries all necessary data in order to create a new EBICS user.

The wizard also ensures that the data is entered in the correct places. This is particularly convenient because the system sets up the download agents via a different menu item than bank accesses and users, for example. Although this makes sense logically, it complicates quick input and makes new setups error-prone and tedious. Dialogs prevent important data from being omitted and enable you to see at a glance what information is actually required. For instance, the first thing to do is to set up a new bank account - whether this is done by the bank or an administrator on the customer side is irrelevant. The dialogue asks for all required information and shows how much work still lies ahead. As many as seven dialogs come together for the setup of a new bank access (see Fig. 2).

Once all bank accesses are set up, it's usually time for the individual users. For example, a small law firm wants to set up account authorisations for the owner, two employed lawyers and an assistant - specifically different ones for each individual. The owner naturally wants to have all rights, be able to order and release transactions without limits and, for example, issue releases for her colleagues via an electronic distributed signature. The two employed lawyers, on the other hand, are only allowed to release transactions up to a certain amount on their own - and the assistant may create payments but not release them. All four in turn should be able to see the account statements which are downloaded from the EBICS bank server. All these configurations are facilitated by a dialog that can create new colleagues for an already created corporate client (see Fig. 3).

 

Starting and working with EBICS in payments can thus be simplified rather easily without sacrificing security and compliance with standards. The setup wizard has been tested in practice and is in use at well-known major customers. If you would like to know more about this feature in TRAVIC-Port, please contact us. Together, we make EBICS easier.


Author: Christian Veith 

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