X9 – BTRS Balance and Transaction Reporting Standard

Transactions records covered by X9 standardsDeveloped by X9, an ANSI-accredited Standards Developing Organization, BTRS, the Balance and Transaction Reporting Standard, aims to replace BAI2 as the unifying guide for balance and transaction reporting in the United States by Q1 2012, promoting consistency, clarity, and interoperability. When published, it will be ANSI X9.121, an American National Standard. X9 standards already play a major role in the financial industry, and, with the release of X9.121, X9 standards will only further expand the level of standardization in the American financial industry.

Properly formatted, easily manageable, and up to date balance and transactional information is critically important to those in charge of running a corporation, providing them with the information necessary to make sound business decisions. Considering the diversity of formats currently used by different banks, this information requires significant effort and expense to organize, generally requiring the use of third party aggregators and/or customized scripts to convert information from several sources into a single format prior to analysis. Especially in today’s global business environment, this becomes a significant issue.

Developed with input from X9 members and a broad, industry-wide survey asking BAI users what in particular they would like to see changed, BTRS is essentially a major update to BAI2, and its goals are, ultimately, to remedy issues with the current system and introduce a process for keeping up with the continued evolution of banking. BAI2, currently the most widely used format, was released in 1987 and has not adequately kept up with the changing financial landscape, leading individual banking institutions to each customize the format to fit their specific needs, in turn leading to growing incompatibilities between banks, defeating the entire purpose of a single format. In fact, BAI is technically not actually a standard, unlike BTRS. Issues with BAI2 include codes that are out of date, simply not used, used inconsistently, overused, used incorrectly, used differently by different banks, used differently for US/foreign transactions, as well as cases where several codes are used for the same sort of transaction.

Given the spread of business relationships across national borders, the development of BTRS has an appropriately strong focus on international transactions, including Unicode UTF-8 support, allowing the format to be used in international transactions with the native language (e.g., Chinese names), interoperability with existing international banking standards (ISO 20022, SWIFT MT code), and requiring a currency code, no longer restricting users to only working in USD. Additionally, BTRS also adds the reporting of individual items within batch deposits.

In short, the publishing of BTRS by X9 is set to drastically increase the interoperability of balance and transaction data in the United States, allow better integration with international business partners, and reduce the costs involved with processing information.

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