Seamless STP with Oracle SOA Suite
- by user12339860
STP stands for “Straight Through Processing”. Wikipedia describes STP as a solution that enables “the entire trade process for capital markets and payment transactions to be conducted electronically without the need for re-keying or manual intervention, subject to legal and regulatory restrictions” .I will deal with the later part of the definition i.e “payment transactions without manual intervention” in this article.
The STP that I am writing about involves the interaction between a Bank and its’ corporate customers,to that extent this business case is also called “Corporate Payments”.Simply put a Corporate Payment-STP solution needs to connect the payment transaction right from the Corporate ERP into the Bank’s Payment Hub. A SOA based STP solution can do a lot more than just process transaction.
But before I get to the solution let me describe the perspectives of the two primary parties in this interaction. The Corporate customer and the Bank.
Corporate's Interaction with Bank:
Typically it is the treasury department of an enterprise which interacts with the Bank on a daily basis. Here is how a day of interaction would look like from the treasury department of a corp.
Corporate Cash
Retrieve Beginning of day totals
Monitor Cash Accounts
Send or receive cash between accounts
Supply chain payments
Payment Settlements
Calculate settlement positions
Retrieve End of Day totals
Assess Transaction Financial Impact
Short Term Investment Desk
Retrieve Current Account information
Conduct Investment activities
Bank’s Interaction with the Corporate :
From the Bank’s perspective, the interaction starts from the point of on boarding a corporate customer to billing the corporate for the value added services it provides. Once the corporate is on-boarded the daily interaction involves
Handle the various formats of data arriving from customers
Process Beginning of Day & End of Day reporting request from customers
Meet compliance requirements
Process Payments
Transmit Payment Status
Challenges with this Interaction :
Both the Bank & the Corporate face many challenges from these interactions. Some of the challenges include
Keeping a consistent view of transaction data for various LOBs of the corporate & the Bank
Corporate customers use different ERPs, hence the data formats are bound to be different Can the Bank’s IT systems convert the data formats that can be easily mapped to the corporate ERP
How does the Bank manage the communication profiles of these customers?
Corporate customers are demanding near real time visibility on their corporate accounts
Corporate customers can make better cash management decisions if they can analyse the impact.
Can the Bank create opportunities to sell its products to the investment desks at corporate houses & manage their orders?
How will the Bank bill the corporate customer for the value added services it provides.
What does a SOA based Seamless STP solution bring to the table?
Highlights of Oracle SOA based STP solution
For the Corporate Customer:
No Manual or Paper based banking transactions
Secure Delivery of Payment data to the Bank from multiple ERPs without customization
Single Portal for monitoring & administering payment transactions
Rule based validation of payments
Customer has data necessary for more effective handling of payment and cash management decisions
Business measurements track progress toward payment cost goals
For the Bank:
Reduces time & complexity of transactions
Simplifies the process of introducing new products to corporate customers
Single Payment hub for all corporate ERP payments across multiple instruments
New Revenue sources by delivering value added services to customers
Leverages existing payment infrastructure
Remove Inconsistent data formats and interchange between bank and corporate systems
Compliance
and many other benefits
