Payments Training Hub
Scheme certification PAYMENT OPERATIONS STARTED LIVE 01 Scheme certification - proves that a bank can exchange payment ACTIVE 02 Certification testing - usually runs in a dedicated test environment QUEUED 03 Clearing systems - their own requirements on top of message QUEUED 04 Certification - not a one off event QUEUED 05 Certification pack - should be treated as a formal deliverable QUEUED Scheme certification proves that a bank can exchange payment messages correctly with a scheme or clearing system. Step 1 of 5 Scheme certification STARTED Scheme certification proves that a bank can exchange payment ACTIVE Certification testing usually runs in a dedicated test environment QUEUED Clearing systems their own requirements on top of message QUEUED Certification not a one off event QUEUED Certification pack should be treated as a formal deliverable QUEUED Scheme certification proves that a bank can exchange payment messages correctly with a scheme or clearing system.
Certification testing PAYMENT OPERATIONS IN PROGRESS LIVE 01 Scheme certification - proves that a bank can exchange payment DONE 02 Certification testing - usually runs in a dedicated test environment ACTIVE 03 Clearing systems - their own requirements on top of message QUEUED 04 Certification - not a one off event QUEUED 05 Certification pack - should be treated as a formal deliverable QUEUED Certification testing usually runs in a dedicated test environment provided by the scheme. Step 2 of 5 Certification testing IN PROGRESS Scheme certification proves that a bank can exchange payment DONE Certification testing usually runs in a dedicated test environment ACTIVE Clearing systems their own requirements on top of message QUEUED Certification not a one off event QUEUED Certification pack should be treated as a formal deliverable QUEUED Certification testing usually runs in a dedicated test environment provided by the scheme.
Clearing systems add own requirements PAYMENT OPERATIONS IN PROGRESS LIVE 01 Scheme certification - proves that a bank can exchange payment DONE 02 Certification testing - usually runs in a dedicated test environment DONE 03 Clearing systems - their own requirements on top of message ACTIVE 04 Certification - not a one off event QUEUED 05 Certification pack - should be treated as a formal deliverable QUEUED Clearing systems add their own requirements on top of message format. Step 3 of 5 Clearing systems add own requirements IN PROGRESS Scheme certification proves that a bank can exchange payment DONE Certification testing usually runs in a dedicated test environment DONE Clearing systems their own requirements on top of message ACTIVE Certification not a one off event QUEUED Certification pack should be treated as a formal deliverable QUEUED Clearing systems add their own requirements on top of message format.
Certification is continuing obligation PAYMENT OPERATIONS IN PROGRESS LIVE 01 Scheme certification - proves that a bank can exchange payment DONE 02 Certification testing - usually runs in a dedicated test environment DONE 03 Clearing systems - their own requirements on top of message DONE 04 Certification - not a one off event ACTIVE 05 Certification pack - should be treated as a formal deliverable QUEUED Certification is not a one off event, it is a continuing obligation. Step 4 of 5 Certification is continuing obligation IN PROGRESS Scheme certification proves that a bank can exchange payment DONE Certification testing usually runs in a dedicated test environment DONE Clearing systems their own requirements on top of message DONE Certification not a one off event ACTIVE Certification pack should be treated as a formal deliverable QUEUED Certification is not a one off event, it is a continuing obligation.
Certification pack is formal deliverable PAYMENT OPERATIONS COMPLETE LIVE 01 Scheme certification - proves that a bank can exchange payment DONE 02 Certification testing - usually runs in a dedicated test environment DONE 03 Clearing systems - their own requirements on top of message DONE 04 Certification - not a one off event DONE 05 Certification pack - should be treated as a formal deliverable ACTIVE A certification pack should be treated as a formal deliverable, with a test plan, test cases, evidence, defect logs and a sign off sheet. Step 5 of 5 Certification pack is formal deliverable COMPLETE Scheme certification proves that a bank can exchange payment DONE Certification testing usually runs in a dedicated test environment DONE Clearing systems their own requirements on top of message DONE Certification not a one off event DONE Certification pack should be treated as a formal deliverable ACTIVE A certification pack should be treated as a formal deliverable, with a test plan, test cases, evidence, defect logs and a sign off sheet.

Key points of this lesson, in order.

0:00 / 3:09 Step 1 of 5

Scheme Certification: What Schemes and Clearing Systems Demand

Payment Testing and Certification, Lesson 4 of 7, Narration 3:09, D11 Operations, exceptions and reconciliation

Charge bearerValue dateLiquidity

What you will learn

Your objective. By the end of this lesson, you will be able to explain scheme certification: what schemes and clearing systems demand. Scheme certification proves that a bank can exchange payment messages correctly with a scheme or clearing system.

Why it matters. Before a bank can join SWIFT, it must prove that its MT103 and pacs.008 messages pass validation, that it can handle acknowledgements, and that its operations team can manage exceptions.

Chapter objective: Learner plans payment testing and certification, including test cases, test data, simulators, and scheme certification, and writes a test plan for a new payment feature. Learner practises this skill on realistic banking cases, explaining the reasoning clearly and using correct terminology throughout the work.

Key learning points

  • Scheme certification
  • Certification testing
  • Clearing systems add own requirements
  • Certification is continuing obligation
  • Certification pack is formal deliverable

Key terms

Charge bearer: A code that states who pays the charges for a payment. In ISO 20022 the values are DEBT for debtor, CRED for creditor, SHAR for shared and SLEV for service level.

Value date: The date on which funds become available to the beneficiary and on which interest starts to accrue. It is the date used for settlement and for nostro posting.

Liquidity: Cash or assets that a bank can use immediately to meet payment obligations. Banks manage liquidity by forecasting inflows and outflows, funding nostro and settlement accounts, and using central bank...

Clearing and settlement timeline showing Scheme Certification: What Schemes and Clearing Systems Demand.

Practise this lesson

Exercise

Work out the net settlement position for the clearing cycle described in this lesson.

Use the clearing rules and the netting logic in this lesson.

  1. What to do. List the payments in the cycle, calculate the net position for each bank, and state what settles.

Correct result. Clearing validates, sorts, matches and nets the instructions, then produces a net position per bank. Only the net position settles, which needs far less liquidity than settling every payment individually.

Why. Netting is what makes high volume payments possible. Without it, every payment would need full liquidity at the moment it is sent.

Check your understanding

Practice question

A tester finds that a pacs.008 with a missing creditor agent is accepted by the system instead of rejected. How should this defect be reported?

Takeaway and next step

What to remember

Good certification work is therefore careful, complete and fully traceable from requirement to result.

Reconcile the payment in this lesson against its statement and find the break.

Open the Accounting and Reconciliation Lab →

Builds on "Writing Test Scenarios for Happy Path and Negative Path".

Transcript and full text

Show transcript

Scheme certification proves that a bank can exchange payment messages correctly with a scheme or clearing system. Before a bank can send live SEPA payments, it must prove that its pacs.008 messages contain the correct IBAN, BIC, amount, currency and charge bearer, and that it can process pacs.002 status reports and pacs.004 returns. Before a bank can join SWIFT, it must prove that its MT103 and pacs.008 messages pass validation, that it can handle acknowledgements, and that its operations team can manage exceptions. Certification is the gate that protects the whole network from one bank sending bad messages. Certification testing usually runs in a dedicated test environment provided by the scheme. The bank sends a set of mandatory test cases, and the scheme checks each message against its rulebook. For SEPA, the tests include a standard credit transfer of 10,000 euros, a payment with a structured remittance reference, a payment that must be rejected for an invalid IBAN, and a return of 2,500 euros after the beneficiary bank cannot apply the funds. Each test has a fixed expected result, and the bank must pass all mandatory cases before it can move to live operation. Clearing systems add their own requirements on top of message format. Faster Payments in the UK requires a bank to respond within seconds, to handle duplicate detection, and to prove that it can process a payment of 1 million pounds within the scheme limit. CHAPS requires a bank to prove that it can settle high value payments on the correct value date, manage liquidity, and handle a payment that is queued because of insufficient funds. A bank that passes message validation but fails performance or liquidity testing will not receive certification, because the scheme must protect all its members. Certification is not a one off event, it is a continuing obligation. Schemes release new rulebooks every year, and banks must retest when a message standard changes. When ISO 20022 migration changed the format of cross border payments, banks had to recertify their pacs.008, pacs.002 and camt.053 handling, and prove that they could still process legacy MT messages during the coexistence period. A bank that misses a mandatory change risks having its messages rejected, its payments delayed, and its customers affected, so certification planning must start months before the deadline. A certification pack should be treated as a formal deliverable, with a test plan, test cases, evidence, defect logs and a sign off sheet. The pack should name the scheme, the version of the rulebook, the test environment, the dates of testing, and the name of the person who approved each result. If a test fails, the pack must record the defect, the fix, and the retest result. Auditors and scheme managers will ask for this evidence, and a bank that cannot produce it will be asked to test again. Good certification work is therefore careful, complete and fully traceable from requirement to result. SEPA certification is the clearest example of what a scheme demands. Before a bank can send live SEPA payments, it must prove that its pacs.008 messages conform to the EPC rulebook, that it handles rejects with the correct reason codes, that it processes returns through pacs.004, and that it responds to recalls through camt.056 and camt.029. The bank sends a set of mandatory test cases to the scheme test environment, and the scheme checks each message field by field. A single wrong field, for example a charge bearer code of DEBT where the rulebook requires SHAR, fails the test case and blocks certification. Certification also has a calendar, and missing it has commercial consequences. Schemes release new rulebooks every year, usually effective in November, and banks must retest before the effective date. When ISO 20022 migration changed the message format, every bank had to re-certify its SEPA, SWIFT, and domestic clearing connections. A bank that misses the deadline cannot send live payments on the new format, which means it cannot serve its customers. For a business analyst, the practical lesson is to track the scheme calendar, to start certification testing months before the deadline, and to treat the certification pack as a formal deliverable with a test plan, evidence, defect logs, and a sign-off sheet.

Scheme certification proves that a bank can exchange payment messages correctly with a scheme or clearing system. Before a bank can send live SEPA payments, it must prove that its pacs.008 messages contain the correct IBAN, BIC, amount, currency and charge bearer, and that it can process pacs.002 status reports and pacs.004 returns. Before a bank can join SWIFT, it must prove that its MT103 and pacs.008 messages pass validation, that it can handle acknowledgements, and that its operations team can manage exceptions. Certification is the gate that protects the whole network from one bank sending bad messages.

Certification testing usually runs in a dedicated test environment provided by the scheme. The bank sends a set of mandatory test cases, and the scheme checks each message against its rulebook. For SEPA, the tests include a standard credit transfer of 10,000 euros, a payment with a structured remittance reference, a payment that must be rejected for an invalid IBAN, and a return of 2,500 euros after the beneficiary bank cannot apply the funds. Each test has a fixed expected result, and the bank must pass all mandatory cases before it can move to live operation.

Clearing systems add their own requirements on top of message format. Faster Payments in the UK requires a bank to respond within seconds, to handle duplicate detection, and to prove that it can process a payment of 1 million pounds within the scheme limit. CHAPS requires a bank to prove that it can settle high value payments on the correct value date, manage liquidity, and handle a payment that is queued because of insufficient funds. A bank that passes message validation but fails performance or liquidity testing will not receive certification, because the scheme must protect all its members.

Certification is not a one off event, it is a continuing obligation. Schemes release new rulebooks every year, and banks must retest when a message standard changes. When ISO 20022 migration changed the format of cross border payments, banks had to recertify their pacs.008, pacs.002 and camt.053 handling, and prove that they could still process legacy MT messages during the coexistence period. A bank that misses a mandatory change risks having its messages rejected, its payments delayed, and its customers affected, so certification planning must start months before the deadline.

A certification pack should be treated as a formal deliverable, with a test plan, test cases, evidence, defect logs and a sign off sheet. The pack should name the scheme, the version of the rulebook, the test environment, the dates of testing, and the name of the person who approved each result. If a test fails, the pack must record the defect, the fix, and the retest result. Auditors and scheme managers will ask for this evidence, and a bank that cannot produce it will be asked to test again. Good certification work is therefore careful, complete and fully traceable from requirement to result.

SEPA certification is the clearest example of what a scheme demands. Before a bank can send live SEPA payments, it must prove that its pacs.008 messages conform to the EPC rulebook, that it handles rejects with the correct reason codes, that it processes returns through pacs.004, and that it responds to recalls through camt.056 and camt.029. The bank sends a set of mandatory test cases to the scheme test environment, and the scheme checks each message field by field. A single wrong field, for example a charge bearer code of DEBT where the rulebook requires SHAR, fails the test case and blocks certification.

Certification also has a calendar, and missing it has commercial consequences. Schemes release new rulebooks every year, usually effective in November, and banks must retest before the effective date. When ISO 20022 migration changed the message format, every bank had to re-certify its SEPA, SWIFT, and domestic clearing connections. A bank that misses the deadline cannot send live payments on the new format, which means it cannot serve its customers. For a business analyst, the practical lesson is to track the scheme calendar, to start certification testing months before the deadline, and to treat the certification pack as a formal deliverable with a test plan, evidence, defect logs, and a sign-off sheet.

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