ISO 21586:2020

INTERNATIONAL ISO
STANDARD 21586
First edition
2020-09
Reference data for financial
services — Specification for the
description of banking products or
services (BPoS)
Données de référence pour les services financiers — Spécification
pour la description de produits ou services bancaires (BPoS)
Reference number
ISO 21586:2020(E)
©
ISO 2020

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ISO 21586:2020(E)

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© ISO 2020
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ISO 21586:2020(E)

Contents Page
Foreword .iv
Introduction .v
1 Scope . 1
2 Normative references . 1
3 Terms, definitions and abbreviated terms . 1
4 Principles . 4
4.1 General principles . 4
4.2 Concrete principles . 4
4.2.1 Types of key elements . 4
4.2.2 Description of multiple BPoS . 5
4.2.3 Sequence of key elements . 6
4.2.4 Descriptive style . 7
5 Level of conformity . 7
5.1 General . 7
5.2 Concrete conformity . 7
6 Key elements . 8
6.1 General . 8
6.2 Concrete key elements . 8
6.2.1 How can a BPoS be identified? . 8
6.2.2 How can the issuer of a BPoS be identified? .11
6.2.3 What are the credentials of a BPoS? . .15
6.2.4 What are the fundamental financial characteristics of a BPoS? .18
7 Requirements of representation .29
7.1 General .29
7.2 Logical tier .29
7.3 Physical tier .29
7.3.1 Principles .29
7.3.2 Key aspects for human reading .29
7.4 Version management .30
Annex A (informative) Method of recording versions of a description .32
Annex B (informative) Logical representation model of BPoS descriptions .33
Annex C (informative) Relationship between fiat currency, historical currency and
cryptocurrency .39
Annex D (informative) Related methodologies .40
Annex E (informative) An example of a BPoS description based on a credit card .41
Bibliography .50
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ISO 21586:2020(E)

Foreword
ISO (the International Organization for Standardization) is a worldwide federation of national standards
bodies (ISO member bodies). The work of preparing International Standards is normally carried out
through ISO technical committees. Each member body interested in a subject for which a technical
committee has been established has the right to be represented on that committee. International
organizations, governmental and non-governmental, in liaison with ISO, also take part in the work.
ISO collaborates closely with the International Electrotechnical Commission (IEC) on all matters of
electrotechnical standardization.
The procedures used to develop this document and those intended for its further maintenance are
described in the ISO/IEC Directives, Part 1. In particular, the different approval criteria needed for the
different types of ISO documents should be noted. This document was drafted in accordance with the
editorial rules of the ISO/IEC Directives, Part 2 (see www .iso .org/ directives).
Attention is drawn to the possibility that some of the elements of this document may be the subject of
patent rights. ISO shall not be held responsible for identifying any or all such patent rights. Details of
any patent rights identified during the development of the document will be in the Introduction and/or
on the ISO list of patent declarations received (see www .iso .org/ patents).
Any trade name used in this document is information given for the convenience of users and does not
constitute an endorsement.
For an explanation of the voluntary nature of standards, the meaning of ISO specific terms and
expressions related to conformity assessment, as well as information about ISO's adherence to the
World Trade Organization (WTO) principles in the Technical Barriers to Trade (TBT) see www .iso .org/
iso/ foreword .html.
This document was prepared by Technical. Committee ISO/TC 68, Financial services, Subcommittee
SC 8, Reference data for financial services.
Any feedback or questions on this document should be directed to the user’s national standards body. A
complete listing of these bodies can be found at www .iso .org/ members .html.
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ISO 21586:2020(E)

Introduction
Banking is an ancient industry. Until the middle of the last century, most banking services had been
simple and could be easily understood by common people. Services provided by different banks were
similar and did not require any specific explanation. Thus, standardizing the descriptions of banking
services was unnecessary at that time.
This situation gradually changed with the introduction of information technology into the banking
industry and the faster adoption of financial innovation. Since the beginning of this century, especially
when Fintech started to play a more important role in the banking industry, the situation has changed
dramatically. On the one hand, traditional banking services are becoming more integrated through
productization as the functions and behaviours of services are determined before they are provided
to customers. The establishment of product management functions in many banks can be deemed
circumstantial evidence of this development. On the other hand, the working of banking products or
services (BPoS, see 3.3) has become so complex that even the practitioner of its issuer cannot always
explain it thoroughly and unambiguously. Moreover, a growing number of institutions other than
traditional financial institutions are selling and servicing BPoS around the world. In some cases, these
institutions are not even supervised by financial supervisory authorities.
To compensate for the increase in complexity, many institutions have started to provide some
structured descriptions for their BPoS, often related to retail products. However, those descriptions are
so diverse amongst the different institutions that customers can barely perform a proper comparison,
even for similar products. Writing the description for BPoS can be a complex job for which only a small
number of experienced staff meet the requirements. Consequently, the standardization of the BPoS
descriptions has become more and more important.
At first glance, it seems relatively easy to establish a specification for the description of BPoS. However,
some issues arise when a specification requires several provisions of the required elements to be
combined.
This document is intended to solve the issues mentioned above. Key elements necessary to describe a
BPoS are defined. These elements are grouped into three categories: required, optional and voluntary.
Required elements: readers would not understand the BPoS correctly if these elements were described
incompletely or ambiguously.
Optional elements: readers would understand the BPoS more completely, clearly and accurately by
acquiring information from these elements.
Voluntary elements: readers would understand the peculiarities and extra benefits of the BPoS.
Required and optional elements are focused on answering four questions: ‘How to identify a BPoS’, ‘How
to identify the issuer of a BPoS’, ‘What are the credentials of a BPoS?’ and ‘What are the fundamental
financial characteristics of a BPoS?’. Voluntary elements are not listed as they are determined when the
description of a BPoS is being formulated so that innovation is not constricted. Figure 1 illustrates the
relationship between these elements.
Figure 1 — Logical categories and groups of elements
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Ordinary customers as well as many employees of financial institutions have no interest in reading
or opportunity to read an ISO standard. How to choose appropriate elements might be a cumbersome
matter. Considering this, six templates are given, called the level of conformity. Figure 2 illustrates
the conceptual mapping on key elements for every level of conformity. If the concept of conformity is
introduced when this document is implemented, customers might easily judge which elements of a
BPoS have been described and practitioners might easily write a description of a BPoS by choosing a
suitable template.
Key
1 expanded 4 picked
2 picked and expanded 5 baseline
3 coincident 6 below baseline
Figure 2 — The relationship of six conformity level templates
After defining the necessary key elements to describe a BPoS, the next step is how to present them
in an appropriate fashion. In this document, this question is dealt with at two levels: a logical tier
and a physical tier. The organization of the information is considered the logical tier and deals with
the correctness of the contents of the BPoS description. Plain language should be used in describing
BPoS. Additionally, more structured ways to organize information (such as XML or JSON) can be used.
The presentation of the information is considered the physical tier and deals with the suitability of
the content for human reading. Some ISO guides, such as ISO/IEC Guide 14 and ISO/IEC Guide 37, are
followed, with mentions of special elements involving personal safety or environmental protection.
These developments around BPoS are considered not only by ISO TC68/SC8 but also by many
regulatory authorities, with regulations having been implemented recently. Methodologies have also
been developed in relation to BPoS (see Annex D). These factors have been considered in this document.
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In conclusion, many stakeholders can benefit from this document. In particular:
— customers can understand the characteristics of a BPoS and take better-informed decisions;
— practitioners can be more efficient in describing the characteristics of a BPoS using the tailoring
templates;
— regulatory authorities can detect whether the information provided for a BPoS is compliant or
transparent enough.
Furthermore, descriptions of BPoS can be readily stored, processed and compared. Innovation can be
triggered by analysing key elements. In a sense, the change induced by Fintech could be considered to
begin with the expansion of channels while the channel is a key element.
This document contains the following clauses:
Scope (Clause 1) This document is intended to be used to describe banking prod-
ucts or services (BPoS) only. The main addressees are practi-
tioners.
Normative references (Clause 2) Documents which are referred to normatively in this document.
Terms, definitions and The terms used in this document are defined. The definition of
abbreviated terms (Clause 3) BPoS is based on ISO 9000.
General principles (Clause 4) Five principles are followed:
1. Types of key elements
2. Description of multiple BPoS
3. Sequence of key elements
4. Descriptive style (concise everyday language)
5. Implementation as a complement to regulations
Level of conformity (Clause 5) Six patterns of conformity are described:
1. Below baseline
2. Baseline
3. Picked
4. Coincident
5. Picked and expanded
6. Expanded
Key elements (Clause 6) Relevant information elements for customers to understand
the nature of a BPoS.
Requirements of representation Presentation of the elements in logical (organizing elements
(Clause 7) correctly) and physical (showing elements correctly) mode.
Annexes
The content of Clause 4 to Clause 6 aims to depict the relevant aspects of describing a BPoS. Figure 3
gives a landscape of those clauses.
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Figure 3 — Landscape of substantial elements for describing BPoS
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INTERNATIONAL STANDARD ISO 21586:2020(E)
Reference data for financial services — Specification for
the description of banking products or services (BPoS)
1 Scope
This document specifies how to describe the characteristics of banking products or services (BPoS)
from a customer’s perspective.
Characteristics of a BPoS can be observed from different facets, called key elements, which are divided
into three groups: required, optional or voluntary elements. This document elaborates on the purpose,
content and description approach for the required and optional key elements.
Six levels of conformity are described in this document which are intended to allow a customer to
assess the coverage of key elements in a BPoS. The logical and physical formats to express key elements
are also defined. This document excludes requirements of a BPoS itself and specific value ranges of any
key element are out of the scope.
This document guides the provider of BPoS in describing their products or services with the intent to
help customers understand or compare specific BPoS. It is not applicable to describing securities or
insurance-related products or services. BPoS can be issued by banks and other institutions.
2 Normative references
The following documents are referred to in the text in such a way that some or all of their content
constitutes requirements of this document. For dated references, only the edition cited applies. For
undated references, the latest edition of the referenced document (including any amendments) applies.
ISO 4217:2015, Codes for the representation of currencies
ISO 9000:2015, Quality management systems — Fundamentals and vocabulary
ISO 9362, Banking — Banking telecommunication messages — Business identifier code (BIC)
ISO 10962, Securities and related financial instruments — Classification of financial instruments (CFI code)
ISO 20275, Financial services — Entity legal forms (ELF)
3 Terms, definitions and abbreviated terms
For the purposes of this document, the terms and definitions given in ISO 9000 and the following apply.
ISO and IEC maintain terminological databases for use in standardization at the following addresses:
— ISO Online browsing platform: available at https:// www .iso .org/ obp
— IEC Electropedia: available at http:// www .electropedia .org/
3.1
banking product
output of a BPoSP (3.4) that can be produced without any transaction taking place between the BPoSP
and the customer (3.5)
Note 1 to entry: In situations where a banking product is defined in accordance with ISO 9000, the term may be
equal to the BPoS.
[SOURCE: ISO 9000:2015, 3.7.6, modified]
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3.2
banking service
output of a BPoSP (3.4) with at least one activity necessarily performed between the BPoSP and the
customer (3.5)
Note 1 to entry: In situations where a banking service is defined in accordance with ISO 9000, the term may be
equal to the BPoS.
[SOURCE: ISO 9000:2015, 3.7.7, modified]
3.3
banking product or service
BPoS
output provided by a provider to their customers (3.5) to meet certain customers’ financial needs or
finance-related needs
[30]
Note 1 to entry: The scope of the BPoS shall be a subset of group 711 in CPC version 2.1 , namely including some
financial services, except investment banking, insurance services and pension services.
Note 2 to entry: The customer can experience the BPoS as either a product or a service, or as a product and a
service inseparably intertwined. See also C. “Goods, services and other products” in Chapter II “The underlying
[30]
principles of the classification” of CPC version 2.1 .
Note 3 to entry: If the plural of BPoS is mentioned, such as a set of BPoS or a family of BPoS, the acronym
remains BPoS.
3.4
banking product or service provider
BPoSP
organization that provides a BPoS (3.3) to a customer (3.5)
Note 1 to entry: The BPoSP is considered as the organization which delivers the BPoS directly to the customer.
3.5
customer
person or organization that could or does receive a BPoS (3.3), namely a banking product (3.1) or a
banking service (3.2), that is intended for or required by this person or organization
Note 1 to entry: Synonym for consumer, client, end-user, retailer, receiver of product or service from an internal
process, beneficiary or purchaser.
[SOURCE: ISO 9000:2015, 3.2.4, modified]
3.6
credential
data provided to the customer (3.5) for identification/authentication purposes
[SOURCE: ISO 12812-1:2017, 3.10]
3.7
credential of BPoS
credential (3.6) issued by a BPoSP (3.4) to the customer (3.5) for identification/authentication purposes
in relation to the BPoS (3.3)
Note 1 to entry: Usually, the credential of BPoS consists of two parts: the identification message and the
authenticated message. Where, depending on the nature of the BPoS, the authenticated message may be omitted,
the identification message alone forms the credential message.
Note 2 to entry: When the credential message is stored in a carrier, the chosen BPoS shall be identified by the
BPoSP via the stored identification message. When the credential message exists without a carrier, the chosen
BPoS shall be identified by the BPoSP via the identification message provided by the customer.
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3.8
instant transaction
operation mode in which the request is processed and the result supplied instantly
Note 1 to entry: Usually the processing result is obtained immediately after the request has been submitted by
the customer (3.5) according to the contract, agreement or regulation of BPoS (3.3).
Note 2 to entry: This mode is available during a specific period of time in accordance with the key elements of BPoS.
3.9
subscribing transaction
subscription transaction
operation mode in which the request is processed with a delay and the processing status, rather than
processing result, is supplied immediately after the request has been submitted
Note 1 to entry: The actual request is processed later, and the execution time depends on the contract, agreement
or regulation of a BPoS (3.3). The actual result of the request is fed back to the customer (3.5) according to the
BPoS. The feedback can be a quiet confirmation when the request was executed successfully, provided this type
of feedback is specified in the BPoS.
Note 2 to entry: In this document, unless indicated otherwise, the terms subscribing transaction and batch
transaction are synonyms.
3.10
period of service
time interval during which instant transactions, subscribing transactions or both are performed
3.11
channel of service
information transfer path with which instant transactions, subscribing transactions or both are
performed
Note 1 to entry: The channel of service can be a manual operation, an electronic operation or a combination of both.
Note 2 to entry: The channel of service is generally related to the period of service and vice versa. In different
channels of service, the period of service (3.10) can be different.
3.12
key element
piece of description which describes a facet of BPoS (3.3)
Note 1 to entry: A key element is a non-negligible characteristic of a BPoS.
3.13
required key element
key element (3.12) describing the obligatory facet of a BPoS (3.3)
Note 1 to entry: The required key element shall be included in the description of every BPoS except if the below
baseline conforming implementation is adopted (see 5.2). Customers (3.5) cannot correctly understand a BPoS if
the required key elements are incomplete or ambiguous.
3.14
optional key element
key element (3.12) describing the complementary facet of a BPoS (3.3)
Note 1 to entry: The optional key element should be described for every BPoS. The optional key elements help
customers to understand the BPoS more completely, unambiguously and accurately.
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3.15
voluntary key element
key element (3.12) describing additional facets of a BPoS (3.3)
Note 1 to entry: The voluntary key elements are information that the BPoSP considers necessary to fully inform a
customer (3.5) about a BPoS but that are not contained in the required and optional key elements.
3.16
conformity
fulfilment of a requirement
Note 1 to entry: In English the word “conformance” is synonymous but dated. In French the word “compliance” is
synonymous but dated.
Note 2 to entry: Conformity constitutes one of the common terms and core definitions for ISO management
system standards given in Annex SL of the Consolidated ISO Supplement to the ISO/IEC Directives, Part 1.
[SOURCE: ISO 9000:2015, 3.6.11]
4 Principles
4.1 General principles
The following principles are given as a guidance on using key elements in describing a BPoS.
a) A key element belongs to either the required, optional or voluntary category, so that the baseline
can be established while innovation can occur.
b) Many BPoS can be described together according to an internal relation logic (a family) or
irrespective of internal logic (a set).
c) The sequence of key elements should be arranged in a way to allow for easy human comparison.
d) The descriptions should use everyday, concise language.
4.2 Concrete principles
4.2.1 Types of key elements
4.2.1.1 Required key elements
The requirements for using required key elements are:
a) If available, content shall be described.
b) “None” shall be indicated if the content of the description does not exist.
c) “Not applicable” shall be indicated if the BPoSP considers the content of the description not to be
applicable.
d) “Uncertain” shall be indicated if the BPoSP considers the content of the description to be uncertain.
The words “none”, “not applicable” and “uncertain” shall be replaced with their synonyms in the
language used to describe a BPoS.
4.2.1.2 Optional key elements
The description requirements of the optional key element are as follows:
a) The content shall be described only if content exists.
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b) The content and its chapter heading in the description of a BPoS may be omitted in one of three
situations:
1) The BPoSP considers no content should be described.
2) The BPoSP considers the content is not applicable.
3) The BPoSP considers the content is uncertain.
c) When the content must be declared according to local regulatory requirements, the optional key
element shall become a required key element in the jurisdiction.
4.2.1.3 Voluntary key elements
The voluntary key elements are described only when a BPoSP considers that some information can add
clarity to a BPoS or make it more attractive for customers. For instance, a voluntary key element may be
additional descriptions for special groups of suitable customers, for distinct channels of service or for
specific regions of service.
The description of a BPoS may include voluntary key elements. The chapter heading in the description
should be provided only when the content of the voluntary key element occurs. The chapter heading and
the content of the voluntary key element shall not overlap with or contradict required or optional key
elements. The BPoSP shall not utilize the voluntary key element to change the substantive meanings of
required or optional key elements.
EXAMPLE The following voluntary key elements have been included in a description of a BPoS because the
BPoSP considers this information to be attractive to potential customers:
a) sales progress;
b) trend of the benefits during the life of the BPoS;
c) investment manager performance on the invested BPoS;
d) comparative information of similar BPoS;
e) ways of solving unusual problems of specific BPoS.
4.2.2 Description of multiple BPoS
4.2.2.1 General rules
M
...