1. Validations and sanity checks
Upon receipt of the request for clearance in the form of ClearanceRQ message the Clearance Manager would perform sanity checks of the message structure and data and will have to validate the data against defined business rules. The sanity checks verify that the XML was formed in compliance with the XSD schema and that data is in the expected format. Any errors at this point will lead to ClearanceRS message with Error complex data element only. It is recommended that all such errors shall be identified at once and XPath should be used to navigate through the ClearanceRQ to locate all nodes with errors.
Only when the sanity checks have been passed the Clearance Manager can continue the validations. The validations verify that certain business rules have been followed when the request has been generated:
- Clearance ID is not blank
- Does the clearance request originate from carrier who is recognized as Settlement with Orders capable carrier?
- Is the Payer or the Payee in the Clearance the party that originated this clearance. The originator of the Clearance creates the Clearance ID, which includes identifier for the originator. This identifier must match the identifier of either the Payer or the Payee.
- Is the clearance request for seller who is certified to work with Settlement with Order standard
- Are the carrier and the seller in agreement to process Settlement with Order transactions
- Is the payment method (described in the Payment Brand Code) acceptable for the Settlement with Order process?
- Has request for clearance with the same Clearance ID been successfully processed already
- If the Clearance Data is not signed by the Clearance Payee and the Clearance Payer then the Clearance Manager checks if a request for clearance with the same Agreement ID and Commitment ID been successfully processed already
- Is the currency code valid for the Clearance Manager’s operational bank account in the market where the payer and payee are clearing?
The very first validation the Clearance Manager will do is to verify that the total count of ClearanceIDs, in the ClearanceRQ message, equals to the number in the data element “Clearance Count”.
If the two do not equal, then the Clearance Manager will respond with ClearanceRS message with “Error” complex data element only using the codes listed in Annex B under the code list identifier “CEC – Clearance Error Codes” without doing any other validations per Clearance.
If the two equal, then the Clearance Manager must validate each Clearance, as identified by its own ClearanceID in the ClearanceRQ message, until all have been checked. Thus, the Clearance Manager will show all possible validation failures. In any case, when doing validations, the Clearance Manager must validate all Clearances in a ClearanceRQ before sending back a ClearanceRS (Clearance Response) message.
Clearance Manager will assign the valid “Remittance Date” and “Settlement Date” according to the SwO Schedule.
2. Clearance Schedule
this is the schedule that specifies the money transfer dates and the data delivery dates related to the operations of the Clearance Manager. It is provided by the Clearance Manager to the users of the Clearance Manager Service and matches the BSP calendar The key dates and periods in the SwO Schedule are:
- ClearanceRQ Submission Deadline Date – CRQSDD – this is the date when the ClearanceRQ from ORA must be submitted. If ClearanceRQ is submitted by this date, then the corresponding Remittance Date (RD) and Settlement Date (SD) can be fulfilled.
- Processing time for the Settlement Manger – P – this is the time the Clearance Manager needs to process the clearance request submitted by the CRQSDD. This could vary by market depending on market size and market operations.
- Clearing Notification delivery to Remittance Payer Deadline Date – CNDDD – this is the date when the Clearing Notification must be delivered to the payer.
- Remittance processing time – R – this is the time necessary for the payer to execute the remittance. It is pre-agreed time period for each market.
- Remittance Date – RD – the date the remittance is executed
- Clearance Manager Settlement Process – S – this is the time necessary to execute the settlement.
- Settlement Date – SD – the date of the settlement
Sample SwO Schedule
The Operation Code is defined by the Clearance Manager where XX denotes ISO country code such as CH for Switzerland. CUR denotes ISO three letter currency code such as CHF for Swiss Franc.
The Payment Frequency Codes are defined by the Clearance Manager in relation to its operations.
3. Net reconcilation
For any given entity the Clearance Manager will receive multiple clearances where the entity will be either the Clearance Payer or the Clearance Payee. Therefore, if the Clearance Manager was performing clearance on daily basis, the settlement manger will add the Net Clearance Amounts of the Clearance where the entity is a Payee and deduct the Net Clearance Amount from the Clearances where the entity is the Payer.
However, if clearance is not performed daily then the Clearance Manager will combine all Clearances with the same Remittance Dates. Then the Clearance Manager will add the Net Clearance Amount for the Clearances where the entity is a Payee and deduct the Net Clearance Amount for the Clearances where the entity is a Payer. Thus the Clearance Manager will determine the Settlement Payees and the Remittance Payer and avoid sending unnecessary Transfer Notifications.