Published: May 2006

What are MA-CUGs?

A Member Administered Closed User Group (MA-CUG) is a mechanism by which corporates are given access to the SWIFT network. By joining a MA-CUG, a corporate can exchange SWIFT messages with a bank which is a member of the SWIFT network.


The Society for Worldwide Interbank Financial Telecommunication (SWIFT) provides secure, standardised messaging services and interface software to 7,800 financial institutions in more than 200 countries. SWIFT has two key roles:

  1. Network provider of secure SWIFT network, linking banks across the globe.
  2. Standards authority for the formats of messages exchanged over the network.

SWIFT messaging formats provide the standard for the vast majority of cross-border transactionrelated information flows between financial institutions.

For more information on SWIFT visit

How do they work?

MA-CUGs can be established by any SWIFT member bank – a bank setting up a MA-CUG will become the administering bank for that MA-CUG. The administering bank can then invite its corporate clients to join the MA-CUG. Every corporate member of the MA-CUG will then be able to exchange messages using the SWIFT network with the administering bank and with any of the banks’ branches that have also registered into the MA-CUG.

All corporate access to the SWIFT network must be routed via the administering bank – corporate members of a MA-CUG cannot use the SWIFT network to communicate directly with each other, nor with any other SWIFT member bank. However, corporates can join as many MA-CUGs as they like to cover their banking activities. The diagram to the right illustrates how a MA-CUG works.

The MA-CUG model
Diagram 1: The MA-CUG model

Why join a MA-CUG?

  • Reduced technological complexity.

    In order to communicate directly with their banking partners, corporates generally have to establish secure network connections and build interfaces between their systems and the banks’ proprietary systems. Most large corporates have multiple banking partners and thus have to build and maintain separate connections and interfaces for each of their banking partners.

    The SWIFT network and messaging standards are however global. Corporates which are members of MA-CUGs only need to build and maintain one SWIFT interface to connect directly to each of their banking partners. Corporates can also connect indirectly to SWIFT through a Member/Concentrator or service bureau.

  • Bulk payment.

    The SWIFTNet FileAct service, available to corporate members of MA-CUGs, allows corporates to generate bulk payment messages which are then sent via the SWIFT network.

  • Lower messaging fees.

    Corporate MA-CUG members pay SWIFT directly for messaging fees (thus avoiding the charge banks typically levy on top of the SWIFT fee). SWIFT also offers volume discounts, lowering the costs further. FileAct also supports proprietary standards.

  • Standardisation.

    The standardised nature of SWIFT message formats enables companies to implement a single protocol for each type of payment message.

  • Security.

    The SWIFT network is incredibly secure. Making a payment via a direct connection to the SWIFT network is one of the most secure payment methods in the world.

  • Straight through processing.

    Payments initiated in an ERP system, TMS or accounting system can be directly converted into a SWIFT payment message and routed directly through the SWIFT network. Similarly, SWIFT payment messages sent to a company will be routed straight into the company’s systems where they can be automatically reconciled – this is true STP.

What are the drawbacks of joining a MA-CUG?

  • Multiple banks, multiple MA-CUGs.

    The MA-CUG structure requires corporates to join a separate MA-CUG for each bank it wishes to exchange SWIFT messages with, although joining is easier than it was. However, the SWIFT interface a corporate has to build to join a MA-CUG can be used to join other MA-CUGs.

  • Cost of implementation.

    Companies wishing to join a MA-CUG will need to invest in SWIFTcompliant systems to provide the interface between their in-house systems and the SWIFT network. Depending on the technology platform and systems in situ, this can be a very costly and time-consuming process. Before embarking on a MA-CUG implementation project, you should be absolutely sure that the benefits of joining a MA-CUG will outweigh this initial outlay.

  • SWIFT joining requirements.

    Corporates joining a MA-CUG are effectively opting to become a corporate member of SWIFT. The joining procedures for corporates are identical to those for banks. The criteria for joining SWIFT are stringent. The process is not complex in itself. Access to SWIFT is however taken very seriously. An extensive review of all systems, security issues and staff training should be undertaken before joining SWIFT.

  • Service levels vary.

    Different banks provide different services as part of their MA-CUG package (eg not all SWIFTNet products are offered by every bank). SWIFT provides a directory of MA-CUGs enabled banks on its website. Over 100 banks including all the major cash management banks are already MA-CUG enabled. Companies need to ensure they understand the range of services, messages and functionalities a particular MA-CUG provides.

  • SWIFT formats may not actually be totally identical between the banks.

    In reality, corporate users of MA-CUGS report that there are very slight differences and some ‘tweaking’ of the interfaces may be necessary. In other words, it is not as easy as it sounds to establish the interfaces.

Who uses MA-CUGs?

Although there has been a significant increase in the number of corporates joining MA-CUGs, the numbers opting to do so are still relatively low (see table below)

Year * Number of MA-CUGs Number of Corporate members
2001 3 10
2002 21 16
2003 41 22
2004 69 55
2005 103 108

* All figures are for year end

The future of MA-CUGs

A proposal to evolve corporate access to SWIFT will be presented and discussed at the June 2006 board meeting and we will report on any developments in future issues. The existing MA-CUG structure is expected to remain and the existing MA-CUGs will remain in place.

We would like to acknowledge the assistance of Stefan Eggli, Head of Treasury Control at Ciba Specialty Chemicals, in the research of this article.

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