By Sofiya Kantorovich and Dave Allen, NRI
Post-trade clearing and settlement processes are a key aspect of institutional broker-dealer and wealth management firms’ record systems. Yet the process is usually very time intensive and rife with manual work.
This is largely due to the convoluted tech stack at many firms, which is the result of years of acquisition and implementation of post-trade settlement technology that has necessitated multiple integrations. The manual work necessary to see a trade through to settlement also contributes to this operational inefficiency. Trades need to be manually booked, with further instruction then sent to a third-party clearing broker. The status of trades must then be manually tracked until settlement is finalized.
This is simply not a sustainable process, especially when tracking hundreds or thousands of trades per day. It is especially onerous for firms that do business in the international market, in particular the APAC region, as time differences lead to a lot of late nights, or early mornings, for those manually tracking the settlement process. This is not an efficient use of internal human capital, which can be better deployed for more value-added tasks.
Introducing NRI I-STAR/GX with BetaNXT BETA
The glaring need for an innovative way to fully automate straight-through processing to settle trades across markets – whether domestic or international – led to our revolutionary partnership with BetaNXT(formerly known as Refinitiv).
This unprecedented partnership between two industry heavyweights combines the power of our I-STAR/GX offering with BetaNXT’s BETA brokerage processing solutions to provide a market-leading, fully automated post-trade processing system.
As noted in an analysis by Aite-Novarica group, “rarely do two established vendors offering clearing and settlement functionality come together to provide a single solution that meets a client requirement without replacing an existing system.”
This means that clients can enjoy the benefit of straight through processing and a fully automated settlement process without the need for an onerous – and costly – full system replacement, which can often be a years-long process.
Firms can now completely automate most trades, in a real-time exception-based processing environment. Clients of the combined new system can benefit from a visually appealing, easy to use dashboard running on exceptions. This will save money and improve operational efficiency, as employees working on manually processing trades, especially international trades, can now focus on a more valuable array of tasks.
This will also enable firms to better serve their best and most profitable customers – such as high-net-worth clients and those who operate in the international markets. Retaining such clients is key for firms to grow and increase profits.
Inefficiency creeps into all business processes over time as they mature. It’s no different in post-trade settlement. Market demand is at a boiling point now for straight through processing automation, which is why we’ve forged this innovative and unique partnership with BetaNXT. Our new integrated solution reduces costs for broker-dealers and wealth management firms, mitigates risk, and minimizes operational inefficiencies.