While the world was shutting down for COVID-19, AFP was kicking off a taskforce to update the U.S. version of the AFP Service Codes.
AFP Service Codes are used in bank billing to allow corporate treasurers to perform analytics on their cash management spend. The new AFP 2020 version of the codes is a major facelift to the old 2013 version, with only 32% of the codes left unchanged.
The AFP Service Code list is downloadable from the AFP website and serves as a complete record of treasury and cash management services offered by commercial banks in today’s market. Anyone new to treasury should have a copy accessible. Banks use many buzz words and acronyms such as e-lockbox, e-bill, A/R match, EBPP and EBIP, but there was never agreement on the official definition of these services for the treasury community. In the AFP Service Code list, we included subject-matter experts from most of the major banks to officially define these services.
AFP Accredited Service Code Provider banks have been using the new codes for almost a year, and other banks have started communicating their migration plan to customers. “We would expect most banks to have migrated to the 2020 version in their billing files by the end of 2023 to avoid confusion, especially in the RFP process,” said Tom Hunt, director of treasury and payments, AFP. Corporate treasurers planning to issue an RFP in the coming year need to be very clear in their pricing schedules which version of the codes they will be using as almost 1,000 codes were deprecated and 330 new codes exist in the 2020 version.
All product families were touched by this update and two new ones were created: Integrated Services and Global Trade Services. Task force members met with subject-matter experts in retained assets, payment cards, trade, debt and credit, and custody services to ensure that for whomever chooses to use these codes internally for data analytics, pricing exercises, or externally for an RFP, the best options are available to reflect today’s treasury environment.
For a comprehensive summary of all changes, you can view this helpful article.