As indicated in the MT 103 STP Guidelines, when an MT 103 STP is sent using the cover method, an MT 202 COV message must be sent to cover the transfer. A credit to a beneficiary's account that is based on the receipt of an MT 103, without receipt of the related cover payment, is a policy decision. Institutions have deployed processes that are approved by their internal risk committees; the risk lies clearly with the beneficiary institution. Guidelines for the processing of an MT 103 STP sent with the cover method have been published by the Payments Market Practice Group (PMPG).
For more details, see the market practice document Guidelines for use of the MT 202 COV on www.pmpg.info.
