Understanding MT 202 and Its Transition to ISO 20022 pacs.009

MT 202: Detailed Description

MT 202 is a SWIFT message type used for financial institution transfers. It is primarily used for transferring funds between financial institutions (e.g., banks) and is most commonly seen in correspondent banking relationships. The message facilitates the movement of funds from one financial institution to another, typically as part of a larger payment flow that might involve customer payments (MT 103) or other financial transactions.

Usage of MT 202

Financial Institution Transfers: MT 202 is used when one financial institution (e.g., a bank) instructs another to transfer funds to a third financial institution. It does not contain detailed customer payment information but rather focuses on the transfer of funds between banks.
Cover Payments: MT 202 is often used in cover payments, where a bank sends an MT 202 to cover the funds for a customer credit transfer (MT 103) sent via a different route.
Nostro/Vostro Transfers: It is also used in managing nostro and vostro accounts, which are accounts that banks hold with each other.

Tags and Corresponding Fields in MT 202

Tag 20: Transaction Reference Number – A unique reference number assigned by the sender.
Tag 21: Related Reference – A reference to the related transaction, such as an MT 103.
Tag 32A: Value Date, Currency Code, Amount – Specifies the date, currency, and amount of the transfer.
Tag 52A: Ordering Institution (optional) – Identifies the bank that is ordering the payment.
Tag 53A/B/D: Sender’s Correspondent (optional) – Identifies the bank sending the funds.
Tag 54A/B/D: Receiver’s Correspondent (optional) – Identifies the bank receiving the funds.
Tag 56A/B/D: Intermediary (optional) – Identifies an intermediary bank involved in the transaction.
Tag 57A/B/D: Account With Institution – Identifies the bank where the funds are to be credited.
Tag 58A/B/D: Beneficiary Institution (optional) – Identifies the final bank to receive the funds.

Corresponding MX Format (PACS.009)

MT 202 maps to the ISO 20022 message format as PACS.009. The PACS.009 message is used for Financial Institution Credit Transfer (equivalent to MT 202) and is structured as follows:

FIToFICustomerCreditTransfer – Root element of the message.
GrpHdr – Group Header containing details like Message Identification and Creation Date Time.
CdtTrfTxInf – Credit Transfer Transaction Information containing details like Instructed Amount, Debtor, Debtor Agent, Creditor, Creditor Agent, etc.

Involvement in Different Flows

Customer to Bank (MT 103 & MT 202): Customer initiates a payment using MT 103. The sender’s bank then uses MT 202 to transfer the corresponding funds to the beneficiary bank.
Bank to Intermediary Bank: If the sender’s bank and beneficiary’s bank do not have a direct relationship, an intermediary bank may be involved. MT 202 is used to transfer funds through the intermediary bank.
Bank to Beneficiary Bank: The final transfer of funds to the beneficiary bank using MT 202.

Example

Here’s an example of an MT 202 message:

MT 202
{1:F01BANKBEBBAXXX0000000000}{2:I202BANKDEFFXXXXN}{4:
:20:TRN12345678901234
:21:RELREF98765432109876
:32A:240822EUR100000,
:52A:/123456789
BANKBEBB
:53A:BANKUS33XXX
:57A:/123456789
BANKDEFF
:58A:/87654321
BANKGB22XXX
}

Explanation:

Transaction Reference Number (Tag 20): TRN12345678901234
Related Reference (Tag 21): RELREF98765432109876
Value Date, Currency Code, Amount (Tag 32A): 24th August 2022, EUR 100,000
Ordering Institution (Tag 52A): BANKBEBB
Sender’s Correspondent (Tag 53A): BANKUS33XXX
Account With Institution (Tag 57A): BANKDEFF
Beneficiary Institution (Tag 58A): BANKGB22XXX

Corresponding PACS.009 Example

<Document>
   <FICdtTrf>>
       <GrpHdr>
           <MsgId>TRN12345678901234</MsgId>
           <CreDtTm>2024-08-22T08:30:00</CreDtTm>
       </GrpHdr>
       <CdtTrfTxInf>
           <PmtId>
               <InstrId>RELREF98765432109876</InstrId>
               <EndToEndId>RELREF98765432109876</EndToEndId>
           </PmtId>
           <IntrBkSttlmAmt Ccy="EUR">100000.00</IntrBkSttlmAmt>
           <IntrBkSttlmDt>2024-08-24</IntrBkSttlmDt>
           <SttlmInf>
               <SttlmMtd>INDA</SttlmMtd>
           </SttlmInf>
           <InstgAgt>
               <FinInstnId>
                   <BICFI>BANKBEBB</BICFI>
               </FinInstnId>
           </InstgAgt>
           <InstdAgt>
               <FinInstnId>
                   <BICFI>BANKDEFF</BICFI>
               </FinInstnId>
           </InstdAgt>
           <CdtrAgt>
               <FinInstnId>
                   <BICFI>BANKGB22XXX</BICFI>
               </FinInstnId>
           </CdtrAgt>
           <Cdtr>
               <Pty>
                   <Id>
                       <Othr>
                           <Id>87654321</Id>
                       </Othr>
                   </Id>
               </Pty>
           </Cdtr>
       </CdtTrfTxInf>
   </FICdtTrf>>
</Document>