Banks race to meet ISO 20022 E&I by 2027, readiness mixed

Banks must update exceptions and investigations (E&I) processing to the ISO 20022 messaging standard by 2027. E&I covers how banks handle mismatches, claims and investigation workflows in cross-border payments.

Readiness across the industry varies. Some institutions have launched multi-year programs that align payments operations, technology and data governance. Other firms are treating the change as a series of tactical system replacements or upgrades.

Payments specialists and bank practitioners say the transition will affect back-office workflows, correspondent banking relationships and data management. ISO 20022 messages include structured, standardized fields that can make it easier to identify transaction issues across correspondent networks, reduce manual steps and shorten resolution times.

An upcoming webinar organized with RedCompass Labs will examine operational and technical risks when banks upgrade systems independently. Topics listed for discussion include interoperability and data mapping challenges, timing mismatches between correspondent banks, and governance questions that may arise from differing implementations of the standard.

Organizers flagged regional variation as a topic for the panel, noting that uptake in Europe and North America may be shaped by different regulatory and market drivers. The event intends to explore whether banks in some regions are further along in aligning payments operations to handle ISO 20022 E&I requirements.

Panel participants include Pratiksha Pathak, head of payments at RedCompass Labs; Bobi Shields-Farrelly, SVP and head of payments operations at PNC; Sean Hickey, cash management product manager at Mizuho Bank; and Scott Hamilton, global payments and liquidity expert, who will moderate.

Background materials state the E&I change forms part of a broader shift to structured messaging aimed at improving cross-border payment reliability and data quality. Organizers recommend that banks assess their current state, define clear success criteria, and coordinate with correspondent banks and internal teams ahead of the 2027 deadline.