Policy News

BAFT submits comments to FATF on the draft implementation Guidance for Recommendation 16 – Payment Transparency

BAFT broadly supports FATF’s draft implementation Guidance for Recommendation 16 and its goal of improving payment transparency, while emphasizing that implementation should remain risk-based, proportionate, technology-neutral and globally consistent. BAFT recommends greater clarity around terminology, alignment with ISO 20022, the role of payment market infrastructures, virtual accounts, data-storage models, and the distinction between existing KYC/CDD verification and payment-message requirements. BAFT also stresses that implementation must account for differences in payment systems and institutional capabilities, particularly in lower-capacity jurisdictions, to avoid unnecessary payment rejections, overcompliance and financial exclusion. Finally, BAFT calls for a pragmatic balance between transparency, privacy and fraud prevention, including risk-based alignment checks rather than strict exact matching and flexibility for instant-payment environments.

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BAFT Comments and Urges Support for Trade in U.S. Capital Rules (Basel Endgame)

WASHINGTON, D.C. – BAFT (Bankers Association for Finance and Trade), the leading global industry association for international transaction banking, urged U.S. federal banking regulators to adjust proposed rules revising capital requirements for banks, noting that proper treatment of trade finance products will help strengthen the U.S. dollar and reinforce the U.S.’s position as a global leader in trade. BAFT’s actions came as part of the comment period on the banking agencies’ rulemaking proposals to modernize the regulatory capital framework for U.S. banks, sometimes referred to as the “Basel Endgame.” 

BAFT applauded the improvements in the approach from the previous rulemaking proposal noting that regulators focused on improving the calibration and risk sensitivity of risk weights, but urged them to take a closer look at trade finance products noting the demonstrably low-risk nature of trade-related items. 
 
Many of the proposed changes, while technical in nature, would change the treatment of various trade finance products, capturing many existing supply chain finance programs that support the needs of businesses. Some of the changes to the risk weights for bank exposures likewise did not consider the unique nature of trade and did not reflect the true risk of various trade products. 
 
“We urge the regulators to ‘sharpen their pencil’ on trade – particularly given the crucial role that trade finance plays in the U.S. economy, ultimately benefiting small businesses and consumers”, said Andrew Price, BAFT VP of International Policy. 
 
BAFT urged the banking agencies to look closely at the unique nature of trade products and consider their broader impact on the economy. 
 
A copy of the letter can be viewed here.

BAFT will host a webinar on July 16 at 10:00 AM ET titled, 2026 Basel III Overview: Where Things Stand Now. The webinar will provide insight into how these new proposals may impact institutions, highlight key issues raised in BAFT’s response to regulators, and offer participants the opportunity to ask questions directly with industry experts. 

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About BAFT (Bankers Association for Finance and Trade)
BAFT is the leading global industry association for international transaction banking. Bringing together financial institutions, service providers, and the regulatory community, BAFT provides thought leadership, advocacy, education, and a platform for collaboration to promote sound financial practices that foster innovation, efficiency, and commercial growth. The association engages in a broad range of issues affecting transaction banking, including trade finance, payments, and compliance, helping members navigate a rapidly evolving global landscape. For more information about BAFT, visit baft.org, or follow BAFT on X (Formally Twitter), LinkedIn, and YouTube.

BAFT Response to ECB Consultation to Extend T2 Operating Hours

BAFT supports extending T2 operating hours in a measured, opt-in, and phased manner to enhance liquidity management, support instant and cross-border payments, and keep traditional payment rails competitive with new technologies. However, it emphasizes that full 24/7/365 operations would impose major costs, risks, and system changes, and should only proceed with clear demand, industry alignment, and long notice periods. BAFT urges careful consideration of operational resilience, liquidity sourcing, cybersecurity, and coordination with T2S, recommending feasibility studies, staggered implementation, and safeguards like circuit breakers and central liquidity bridges.

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BAFT Comment Letter to FRS/FDIC/OCC RFI on Payments Fraud

BAFT submitted a comment letter to urge regulators to expand collaboration across banks, fintechs, telecom, social media, and law enforcement — both domestically and internationally — to effectively combat payments fraud. The association calls for real-time data sharing, clearer liability standards, and safe harbor protections so banks can pause suspicious transactions without fear of penalty. It also recommends updated regulations, industry-wide fraud standards, and consumer/business education campaigns to strengthen prevention, detection, and mitigation efforts.

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Position Paper on the National Transposition of Article 21C CRD VI

BAFT joined with numerous trade associations, including the Bank Policy Institute, UK Finance, the Loan Market Association, the Swiss Finance Council, and others, to urge European Union Member States to implement the branch requirements under CRD VI (Capital Requirements Directive) in a uniform and harmonized manner. This effort is part of BAFT’s overall advocacy on Basel III capital standards as they are implemented at the national level. CRD VI was, in part, the EU’s adoption of the final pieces of the Basel III Framework.

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