Service Bureaus: Little-Known Key Players in Swiss Payments

Required knowledge

• Familiarity with the SIC system
• Understanding of the role and function of service bureaus

As the communication interface between SIC participants and the Swiss Interbank Clearing (SIC) RTGS system, the service bureaus play a central role in payments. Their main tasks include the transmission of payment orders, ensuring data integrity, and complying with the technical and organizational requirements of the Swiss National Bank (SNB). The service bureaus have been in existence since the 1990s and have since established themselves as indispensable players in Swiss payment traffic. 

In April 2024, the SNB published the first detailed formal and technical requirements for the service bureaus that operate the communication interfaces to the SIC system. Previously, they had only been mentioned sporadically in the SIC handbook. The current reference work devotes two separate chapters to them.

Why the Effort?

It makes sense to have as many service bureaus as possible for several reasons. A larger number encourages competition, which leads to better services and innovative solutions. SIC participants benefit because they can choose from a large number of providers to find the one that best meets their specific needs. Distributing communication interfaces across multiple service bureaus also minimizes the risk of downtime and security breaches. If one service bureau experiences technical problems, others can step in and keep operations running.

A larger number of service bureaus also increases accessibility and flexibility for SIC participants. They can choose the service bureau that is geographically closest to them or that offers specialized services that meet their needs. Different service bureaus can specialize in different aspects of payments, resulting in greater efficiency and better service quality. SIC participants thus receive solutions tailored to their needs. Competition between service bureaus can also lead to lower costs for SIC participants. This is particularly beneficial for smaller banks and financial institutions that may have limited resources.

Safety and Efficiency

The SNB has formulated requirements to ensure the security and efficiency of cashless payments in Switzerland, for which it has a legal mandate. This includes the SIC system.

The requirements aim to ensure the security of the communication channels and thus of the entire SIC system. This is particularly important because the service bureaus act as third-party providers and transmit transactions on behalf of the financial institutions participating in the SIC system. To ensure that these transactions can be processed securely and efficiently, they must meet certain minimum requirements.

The most important of these are organizational and technical measures. For example, service bureaus must have their own legal personality and be registered in the Swiss Commercial Register. They must also have an independent auditor and implement documented technical and organizational measures for data security. These measures must comply with the requirements of the Federal Data Protection Act and the relevant ordinances.

Instant Payments

Another important aspect is the role of critical service bureaus. These are particularly important because they must ensure that payments can be resumed quickly in the event of disruption. Restart time, or the time within which emergency operations must be resumed, is a critical factor. Critical service bureaus must be able to resume operations in the shortest possible time to ensure payment continuity. This is particularly true for instant payments, where transactions are processed in real time and delays or outages can have a significant impact.

The requirements of the SNB are binding. All service bureaus already licensed, as well as new ones wishing to offer their services in the future, must meet these minimum requirements. The SNB has also introduced a certification procedure to verify that the requirements are met. Service bureaus that fail to do so may lose their license. The strict requirements and the certification process ensure that only trustworthy and well-organized service bureaus are granted access to the SIC system.

Course Successfully Mastered

Of the seven service providers authorized and certified by the SNB, six currently support the SIC IP service. These are Bottomline Technologies DACH, Con-Ex.io Schweiz GmbH, EFiS Swiss AG, Finastra Switzerland, Hypothekarbank Lenzburg and Worldline.

Worldline is a leading global provider of payment transaction services and has more than 25 years of experience as a service bureau for Swift. It serves around 50 clients worldwide with 90 BIC codes. However, certification as a SIC IP Service Bureau has been a challenge. Worldline launched a major implementation project in 2023 to enable its largest customers to receive and process instant payments in Swiss francs by the time the SIC IP service is launched in August 2024. Banks with smaller volumes will have to comply two years later. With the successful project implementation and certification as a SIC Service Bureau, Worldline can offer its customers a fast, robust, and cost-effective solution. At the same time, Worldline’s solid presence in Switzerland ensures compliance with SNB regulations at all times and further strengthens confidence in Worldline’s services.

Technical Readiness

Worldline already has a highly available and stable infrastructure, operated by a team of 50 experienced professionals. However, the company has recognized the need to revise the design and implementation of its infrastructure to integrate the new SIC-specific components. These are:

• New HSM boxes for storing certificate profiles
• SIX Advanced Security Server (SASS) software for authenticating messages and encrypting channels
• A dedicated point-to-point network connection between Worldline and SIX
• Integration of the SIC adapter to establish a logical channel between Worldline’s messaging interface and SIX

Worldline mastered this challenge efficiently as part of an agile project and thanks to the teamwork of motivated colleagues. From the implementation of the additional infrastructure to full certification as a SIC IP Service Office, the project took just under a year.

The success of this project is due not only to the commitment of the teams involved, but also to the comprehensive documentation and guidelines provided by SIX, the operator of the SIC IP infrastructure. Regular meetings with SIX and the SNB were essential to keep the project on schedule. They ensured that Worldline was able to identify optimal solutions for existing and potential clients in Switzerland. Worldline took on a dual role: as an active SIC IP participant and as a supporting service bureau for its clients. This dual role presented additional challenges, as customer acquisition was taking place in parallel with the mandatory certification process.

Worldline operates its current SIC IP infrastructure with two active data centers in active-active mode in parallel. A remote cold backup site complements this infrastructure and takes control in the event of an emergency. Worldline's SIC IP service guarantees the following:

• High availability so that maintenance activities do not interrupt the service at any time of the year (24x7x365)
• Low network latency to meet strict end-to-end processing times for instant payments
• Continuous monitoring 24x7 
• Regular updates in accordance with the requirements of the supervisory authorities

This multi-center structure provides the basis for end-to-end processing of instant payments. In addition, SIC IP’s connection to Worldline enables easy and cost-effective expansion to other Worldline services such as TIPS and RT1, as well as cross-border payment solutions.

The Way Forward

With the increasing demand for instant payments, Worldline is proud to be one of the selected certified service bureaus to connect to SIC IP. To strengthen its range of services for its customers, the payment service provider now also offers the option of connecting to SIC IP via Swift. As part of these new initiatives, the company remains committed to ensuring compliance for its clients by adhering to the guidelines, requirements, and recommendations of the SNB and SIX.

The Worldline project team is pleased with the completion of the project and would like to emphasize the excellent cooperation with SIX and SNB. The clear guidance throughout the process was invaluable and the commitment and support contributed significantly to the success of the project.

Sharareh Sadri, Project Instant Payments & Worldline Service Bureau, Worldline
Dave Duizendstra, Product Manager Worldline Service Bureau, Worldline
Gabriel Juri, SIX