News

SWIFT TSU no longer available post December 2020

07/05/2019

Although not officially announced by SWIFT, and the SWIFT website is still actively providing tools and coverage of the Trade Service Utility (TSU), it has recently been announced in a couple of trade finance publications - GTR and TXF - that SWIFT have decided that the TSU and its transaction matching application functionality, on which the Bank Payment Obligation (BPO) relies, will be decommissioned in December 2020.

In itself, the decommissioning of the TSU does not spell the end for the BPO product, provided another organisation can provide a system with the same functionality as the TSU. Unlikely, but possible.

It is true to say that the TSU never hit the heights of the volume expectations when it was first made available in 2008 or when the URBPO rules were introduced in 2013. However, banks and corporates are using the product and the rules. If anything, the TSU and BPO have become the catalyst for the digitalisation solutions that are available today or are in development.

 


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Let’s take the case of a seller and a buyer which agree that the sale of the merchandise should be covered with an electronic L/C using the trade.XXX-bank.platform . In such a situation, and In order to facilitate the task of the seller concerning the handling of the electronic L/C, the seller could send a proforma invoice to the buyer containing among other terms the following basic instructions to be mentioned in the L/C: - this L/C is subject to eUCP latest version (this mention is in any case compulsory) - Electronic presentation shall be effected through ….https://trade.XXX-bank.platform/……. (this mention is also compulsory) - Each document, except B/L, may be presented either as a paper document or as an electronic record in format acceptable by the issuing and the nominated bank (this clause will give to the seller more flexibility to present the documents to the bank) - Scanned copy of ….carrier’s certificate….. in a pdf format acceptable (this clause can be inserted for any document indicated in the L/C which the seller is not certain to get in an electronic record, but he knows that he can get it in a paper form and on top of that he would like to be in a position the present it through the platform in a pdf format) Kindly tell me whether you understand these clauses ? Are these clauses correctly drafted? Could you suggest any other clause to be added in order to facilitate the task of the seller for the handling of the electronic L/C?