UniCredit: Perfect payment partners – Dr Luciano Cassiago

While the corporate marketplace awaits the SEPA migration end-date, multinationals are continuing to seek fast and efficient ways around the reams of red tape often associated with cross-border expansion. UniCredit's Dr Luciano Cassiago tells Finance Director Europe about the importance of a collaborative approach and how a centralized and secure payments factory can help to simplify the process.

The aftershocks of the recession are still being felt, yet corporates are beginning to look to the future with a moderate sense of optimism. For many, growth will be underpinned and bolstered by more diverse payments factories. Operating across several countries and markets, the ability to ensure fast and secure payment methods, while adhering to each country's respective financial codes and regulations, is imperative.

For banking networks such as UniCredit, it has been a case of adjusting its services in order to assist multinationals in achieving these aims, consolidating and diversifying the efficiency of payment processes into a single factory to reduce costs for treasurers.

Red tape has long been the bane of multinationals' existence in terms of expanding business activities. Operating within its traditional market of Italy, the likes of UniCredit continue to face a series of challenges as a result of the country's renowned high level of local bureaucracy and regulations, which have the potential to severely delay the implementation of payment systems. This has been particularly prevalent in the wake of the downturn, triggering a number of changes to banking codes, as Dr Luciano Cassiago, international cash management sales at UniCredit, explains.

"For Italian multinational customers, it is very important to consider the local financial environment and climate," he says. "Challenges continue to come from local rules and internal regulations. If you take the field of payments, having a payment factory in Italy and operating on behalf of subsidiaries is still a subject of uncertainty, particularly when operating on a large scale."

In order to tackle such hurdles, UniCredit has focused on streamlining communications and formats. Since 2009, it has offered customers a genuine gateway between Italy's existing domestic corporate banking network, CBI and SWIFT.

In facilitating these increased cross-border payments, Cassiago is keen to emphasise the integral part played by the Society for Worldwide Interbank Financial Telecommunication (SWIFT). Utilised by more than 9,000 banking organisations in over 200 countries, it is a member-owned cooperative, which allows operations and payments to be processed with speed and added security. This includes the ISO 20022 financial industry message scheme, also developed by SWIFT.

"Today, for big multinationals and corporates, the solution offered by SWIFT represents a great opportunity to standardise payment processes while ensuring absolute security control and reliability," he says. "In my opinion, the ISO 20022 will really be the answer, at least in Europe where the regulatory environment is similar from country to country. This means that we really need to focus on a common language, not just common rules. Therefore, I would say that the key ingredient is to find a good combination, in terms of communication between banks, and then standardise what goes through these channels."

Tried and trusted

UniCredit has a long-standing reputation for building strong relationships with its clients based on trust, cooperation and transparency, establishing the company as an attractive partner in transforming payment operations. As a pan-European banking organisation, it has a considerable presence in 22 countries, its core markets being Italy, Austria and Germany, with additional operations in Eastern and Central Europe - in the last two years it has opened branches in Bulgaria, Slovakia and Lithuania.

"It is essential to create an environment of trust and cooperation that distinguishes us as a bank," says Cassiago. "In this way, we can assist customers in decision-making while simultaneously being both a service supplier and business partner."

UniCredit's approach to partnership also incorporates an ethos based on flexibility. Engendered through SWIFT, both small and large companies have access to a range of different communicative formats, allowing successful streamlining between banks. With over 9,600 branches across its target markets, UniCredit offers a number of services that enable corporates to circumvent potential hindrances associated with local regulations. In the case of a multinational looking to open a business overseas, it operates using standardised request forms and referral procedures, imposing greater cost and time efficiency on what was once a tedious procedure.

"This is our added value," says Cassiago. "Sometimes, it isn't easy for customers approaching new markets to understand the potential difficulties. Our knowledge is of great value to our customers."

UniCredit employs a strong relationship manager network across its international markets to advise on everything from language barriers to relative credit card and local electronic banking systems. In addition to this local knowledge, it also offers a centralised transaction service, EuropeanGate, allowing companies access to all banks within the UniCredit group through a single platform.

"Banks such as UniCredit are already preparing for the SEPA migration date by offering multicountry platforms using a common XML."

"EuropeanGate enables the customer to process payments using both domestic and international formats such as SWIFT and ISO," explains Cassiago. "We provide customers with a centralised access, process and contract which saves a lot of money in the long run."

A date with destiny

Cassiago is aware that UniCredit's future direction rests on the much-vaunted SEPA migration date, still yet to be declared. Already SEPA-enabled and well positioned to assist its multinational businesses in aligning the costs of cross-border transactions with domestic ones through XML formats, is it now simply a case of playing the waiting game?

"The future is on hold until decisions regarding SEPA are made," he says. "Currently, we have customers asking us, 'What should we do in the future in terms of SEPA? What should we develop internally?' Our advice is to use ISO 20022, as aside from reaching all of UniCredit's international markets, for both existing and prospective customers, it is an excellent value-added conversion platform.

"We, as a bank, together with our customers, are also obliged to plan and schedule intervention in terms of internal processes and formats. I am optimistic, as we already have the instruments of the future in place."

While banks such as UniCredit are already preparing for the SEPA migration date by offering multi-country platforms using a common XML, Cassiago appreciates that there might still be some way to go before other corporates catch on to the potential of a borderless system of payments.

"Frankly speaking, at a corporate level, there has been a certain amount of laziness with regards to SEPA," he says. "We have not seen migration at all except in certain countries that have adopted it as a domestic payment system. I really hope that the financial crisis will not affect this process. Migration would be a major step."

Dr Luciano Cassiago, international cash management sales, UniCredit.