Sibos 2025: The Case for Consolidation Continues to Build

It always takes some time to process Sibos. Amid what feels like thousands of presentations, panels and chats, recognising which topics are short-term gimmicks and which stand to have a long-term impact is no easy task.

But reflecting on our discussions from this year’s show brings clarity, for there is a single unifying theme that tied everything together. Whether it be momentum for stablecoins, innovation in cross-border payments, or the challenges of unlocking the value of ISO 20022 data now co-existence is ending, it is increasingly apparent that all roads lead back to consolidating the banks’ payment infrastructure to support any payment, anytime, anywhere. And yes, we discussed AI, but this warrants its own blog.

So, are stablecoins really the future of money?

Sibos highlighted that stablecoins have undoubtedly entered the financial mainstream, propelled by regulatory endorsement – with support primarily stemming from the U.S. and the GENIUS Act, rather than the EU’s MiCA regulation (which favours CBDCs).

While banks have been experimenting for some time to get to grips with the underlying technology, this regulatory impetus is now supporting increased adoption. Promising use-cases for banks, although unproven from a business case perspective, include B2B cross-border payments, remittances, and crypto-trading. For fintechs wanting to clear and settle outside of the fiat infrastructure, the business case looks a bit more promising.

What does this mean for banks? As general adoption builds, interoperability is emerging as the key consideration that you can’t risk missing. While momentum is behind stablecoins currently, it is hopefully not a zero-sum game and there will be continued co-existence of different digital asset types and infrastructures. This means that promoting interoperability across digital assets – as well as traditional financial instruments and infrastructures – must now be a key priority. And there will be a lot of work needed to support.

This is also where we see that Swift’s blockchain-based ledger could be a potential game-changer in helping bridge some of the interoperability gaps and speed up adoption. But this will mean yet one more thing to support, requiring that banks also focus on ensuring their own payment processing solutions are flexible to be able to orchestrate and integrate with these multiple external digital asset solutions.

It is also important to note that a huge degree of uncertainty remains. The real challenge – and opportunities – will come as banks start to truly transform their processes and scale. While it may not be glamorous, this brings us back to the need for a clear and executable strategy that outlines why transformation is required, what ‘good looks like’ in terms of the target state, and how to get there.

There must be 50 ways to clear a cross-border payment

The Financial Stability Board has confirmed the G20’s 2027 target to make international cross-border payments faster, cheaper and more transparent will be missed, but Sibos did showcase the significant innovation happening across the space – with growing momentum for alternative, next-generation methods for clearing and settlement.

To (vaguely) echo Paul Simon, the result is that banks now have about 50 ways to clear a payment. We have already touched on the potential of stablecoins and Swift’s blockchain ledger, and we are also seeing a growing number of solutions offered by non-bank players (make a new plan, Stan). Elsewhere, one-leg-out (OLO) transfers and initiatives such as Project Nexus, led by the Bank for International Settlements are showing promise to move from one instant payment scheme to another (sneak out the back, Jack).

Yet this again means the issue of fragmentation must be addressed.

Firstly, the bold move for banks should be to consolidate their infrastructure and start treating cross-border payments as just another payment (don’t need to be coy, Roy). The payments processing value chain should shift from horizontal flows – or ‘rails’ – for single payment types towards decoupled, vertical, bespoke, service-aligned flows spanning order management, execution, and clearing and settlement.

This then helps to unlock the significant opportunities posed by ‘smart routing’ (hop on the bus, Gus), enabling banks to determine the payment type and select the most appropriate way to efficiently clear and settle (validation). They can also leverage information on who sent the payment and who is receiving it based on client profiles and dynamic processing settings (qualification).

In the meantime, most banks are still a long way from truly monetising data

Consolidation and value chain thinking can also help banks finally start to address a seemingly intractable challenge – monetising data.

ISO 20022 was touted as the silver bullet to enable banks to fully utilise vast swathes of data, yet various factors mean that the value is remaining broadly unrealized. Uneven interpretations and implementations across different banks and jurisdictions – as well as the fact that some banks have only modernised around the edges when migrating to ISO 20022 – mean that fragmentation (that word again!) remains an issue.

The challenge of finding the ‘killer app’ is also compounded by the fact that many corporates have not upgraded their ERP systems to initiate ISO 20022 payments, meaning they are not yet pushing banks for value-added services based on the new data fields.

While data monetisation remains a long-term challenge, decoupling the value chain is an important first step – helping to unlock data that is tied up in individual end-to-end payment flows and enabling it to be used across the organisation to start enabling the delivery of new services and offerings.

Collaboration – The key to innovation

For a traditionally conservative and risk-averse industry, Sibos was a stark reminder of how quickly financial services are now moving. As Icon noted in our recent Letter to Stakeholders, this “demands that banks are resilient and have the ability to adapt to change quickly, while staying in control.”  

This is why we are seeing banks increasingly turning to Icon and the Icon Payments Framework (IPF), as it enables them to modernise safely, quickly and cost-effectively to meet rapidly emerging challenges and opportunities. This controlled and progressive approach to consolidation empowers banks with the fundamental ability to change, allowing them to lead payments forward.

However, the key to this approach is not being dependent on a single vendor and having the flexibility to collaborate with 3^rd parties on your own terms. Drop off the key Lee, and get yourself free.