As the November 2025 deadline for banks to implement the ISO 20022 financial messaging format approaches, many corporates still have no defined path or plan. While the standard promises to streamline and supercharge global payments, some corporates will miss out.
Central to the confusion is the fact that corporates have not been given an ISO 20022 deadline, and so, worlds are colliding. "Banks are clear on their compliance dates, but corporates are struggling to understand what they need to do," explains Richard Ransom, Head of Corporate Solution Consulting at Bottomline.
While banks have been given an unambiguous directive, expectations for corporates remain nebulous at best. Ransom highlights what needs to happen: "There's no industry mandate on corporates to change,” he said, adding that “It's up to the bank” to help corporate clients enjoy the benefits of ISO 20022 as they become available.
Lopsided Market Moves
The absence of requirements for corporates has led to patchwork interpretations and expectations from different players, leaving many companies unsure of their responsibilities. The confusion isn't just theoretical – it's causing headaches right now.
Ransom shared an anecdote from a recent cash management conference: "Corporates are being told, 'In six months, we need you to start sending in this ISO message format,' which is quite a tall order." But looming over that problem is this one: the information corporates get is often incomplete or misleading.
Many are left wondering about the ISO 20022 specifics. What fields need to be changed? How should addresses be structured? What does ‘enhanced fields’ mean? And perhaps most importantly, what happens if they miss some November deadline their banker mentioned in Q4 last year?
For those corporates that appreciate the urgency (not all do), banks and payment service providers (PSPs) are proving the best resources. But remember that time (lack of it, actually) is a major factor.
The Risks of Non-Compliance: Data Truncation and Lost Opportunities
While there may not be an official penalty for companies that aren't ISO 20022-ready by November 2025, the risks are still significant. Ransom warns of a particularly thorny issue: message truncation.
"If [corporates] miss the November date, they might miss out on new data functionality," he said. That means those using, say, the older MT standard won’t enjoy straight-through processing and other advances of the MX messages used with ISO 20022.
Data opacity can also lead to reconciliation problems, making it harder for companies to track and manage business payments. The new standard deals with that – if you use it.
As noted, a key change in ISO 20022 is the requirement for structured addresses. This might seem like just another detail, but Ransom says otherwise. "Structured addresses for cross-border payments will be mandated by 2026, and corporates should start preparing for this change," he said. The benefits are significant. Structured addresses can:
- Facilitate easier sanction screening
- Improve interoperability between different payment systems
- Enhance fraud detection capabilities
Moreover, corporates that embrace this change early could find themselves in a stronger negotiating position with their banks. "Corporates can negotiate better terms with their banks by providing more information in ISO messages," he says.
Ready, Steady, Go
There’s nothing simple for corporates in this industrywide changeover. The key is proactive organization and clear communication with banks and partners. Useful tips for corporates regarding the November deadline and making the most of ISO 20022 are as follows:
- Start the conversation early: Don't wait for your bank to approach you about ISO 20022. Initiate discussions now to understand specific requirements and timelines.
- Assess your current systems: Evaluate your existing payment and reconciliation processes. How much needs to change to accommodate the new format?
- Plan for structured addresses: Begin the process of structuring your address data. This will not only prepare you for ISO 20022 but could also improve your overall data quality.
- Consider the benefits: Look beyond compliance and explore how ISO 20022 could benefit your business. Ransom suggests it could help "reduce sales outstanding by a number of days and the age of debt by providing more detailed information."
- Stay informed: Keep on top of developments in ISO 20022 implementation. It’s continuously evolving, and staying updated will help you adapt more readily.
While much of the focus has been on retail payments, Ransom argues that corporate payment frictions need the attention more. "Retail payments are often prioritized because they are more politically visible and easier to get investment in," he said.
However, the complexities and volumes involved in corporate payments make them equally, if not more, important to deal with now. And, as the November 2025 deadline approaches, corporates must take an active role in their ISO 20022 preparation.
By understanding the challenges, communicating clearly with banking partners, and understanding potential benefits, companies can turn this disruption into an opportunity for improved payment processes and stronger financial management.
Engage actively with your cash management, treasury, payments, and banking partners, and view this transition not just as a compliance issue, but as an opportunity to enhance your payment processes and financial operations.
By dealing with details like structured data and leveraging the enhancements ISO 20022 brings, corporates can realize dramatic banking efficiencies. For banks, it may be worth partnering on this one. The potential benefits – from improved reconciliation to better fraud detection and more efficient cash management – make experts worth a serious look.
In the end, ISO 20022 is more than just a new financial messaging standard – it's a catalyst for modernizing corporate payment systems and processes. The momentum behind that is unstoppable. The journey for ISO 20022 has just started, and corporates need to get on board the train now or miss their stop for operational efficiency.