IBM unveils financial middleware

In order to provide financial institutions a method of adjusting to new international messaging standards, IBM Corp. has announced a middleware suite designed to enable the transition to Internet-based payments and settlements.

Called WebSphere Financial Network Integrator, the suite will become available in the second half of the year, offering public-key infrastructure (PKI) authentication services and IBM MQSeries adapters that enable legacy back-office applications to converse with new XML (Extensible Markup Language) applications.

The need for the shift arises from a dictum from Belgium-based banking cooperative SWIFT SCRL stating that it will shift from its mainframe/Unix-dependent X.25 messaging standards to a Web-based system by 2005. More than 7,000 financial institutions use SWIFT’s messaging service for overnight payment clearance.

IBM has supported SWIFT’s current messaging platform with its Message Entry and Routing with Interfaces to Various Applications system, known as MERVA, for more than 20 years.

The new middleware is designed to take those customers and graft Web capabilities on top of the existing infrastructure.

In particular, IBM will handle the trust services and authentication required to complete online transactions on its own systems.

“We will not expect the customer to install any more PKI in order to use the system,” said Melanie Rose, director of solutions technology development at IBM.

IBM isn’t the first company in this space. Boston-based Omgeo LLC and the Global Straight Through Processing Association in Zurich have also been designing systems to synchronize IP-based financial trades with legacy systems.