I have been researching on FIX protocol to use in one of our usecase. We want to transfer funds (payouts to our customers) from one bank account to some other bank account ( User’s bank account) both within US and globally in several countries. I have found a FIX message named “Appendix 6- H Use of SettlInstructions” but not sure if this will actually serve our purpose i.e. transferring funds from one bank account to other via SWIFT
I would be grateful if someone can help me form a solution.
Are you thinking of, for example, a dealer (XYZ Capital Markets) instructing their bank (e.g. Bank of America) to transfer funds out of their account to HSBC because XYZ Capital Markets needs to settle with their customer who banks with HSBC?
Or are you thinking of, an asset manager communicating with their custodian that the custodian has permission to transfer the funds to settle a trade or make some payment? (and getting statuses back)
The actual instructing bank to bank cash movement as in first example is a remit of SWIFT messages (either the MT or MX messages).
In my second example above, FIX is working on extending a new set of FIX messages, PayManagement, that was introduced in 2019 to support this type of communication.
All that said, if you simply want to identify the settlement accounts or other settlement instructions (e.g. as part of the Confirmation(35=AK) or AllocationInstruction(35=J) messages) that will be used when it comes time to settle the trade and actually make the payment via SWIFT, yes typically that would be identified in the SettlInstructionsData component and the embedded SettlParties component. This may be used to convey the information used to initiate the SWIFT (MT or MX) message to move funds. FIX messages are not used to instruct actual movement of funds on the SWIFT network.