Blockchain and fund settlement services feature in investment market review

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A group of trade groups for the investment industry has outlined the next step in its project to improve trading in the fund market.

The Investment Association, ABI, Tisa, Wealth Management Association, the UK Platform Group launched the UK Fund Trading and Settlement project in May, initially calling for input from the industry.

The UK FTS has outlined the initial findings outlining five areas where there is room to improve operational efficiency and reduce risk. They include:

  • The adoption of a common industry standard for fund trading
  • Increasing the adoption of fund settlement services to provide more efficient payments and reconciliations
  • Improving the management of fund data and distribution of fund prices, by introducing common standards and reviewing whether a single industry utility should be developed
  • Building standardised legal and service level agreements, increasing common standards and removing barriers to entry
  • Creating a forum which seeks to investigate the development of emerging technology such as blockchain

The UK FTS has proposed establishing a cross industry body to oversee the standards and monitor new technologies coming to the market.

In early 2017, the UK FTS will call for feedback from across the funds industry.

The UK FTS has also announced that current chair Ed Dymott from Fidelity International will be replaced by Phil Hine, UK transformation director at Old Mutual Wealth.

Hine says: “The recent FCA asset management market review, reinforces the need to ensure that the industry delivers cost effectively and transparently to millions of UK savers and investors.

“The FTS initiative provides a great demonstration of steps already underway to enhance operational efficiency.”