Handling funds efficiently, cost-effective and standardized with Incentage flow manager for SWIFTNet Funds
The Issue
The funds industry is faced with many challenges … cumbersome communication and transaction handling is still being widely used, increase in open architecture distribution, multi manager products, expected growth with margins under pressure, missing automation and STP rates are just a few of the challenges.
- Fax, e-mail, telephone and proprietary file transfers are still the predominant communication channels between investors' intermediaries and distributors, transfer agents, fund management companies and fund administrators
- Profitability is low, client service and satisfaction difficult to achieve, secure communication channels are lacking, proprietary message standards are the standard of the day and there is a huge gap between the handling of domestic versus crossborder funds
- There is a noticeable lack of straight-through processing and straight-through reporting rates for investors' intermediaries, distributors, fund management companies and their respective service providers
- Facts are:
- Approximately 30% of Fund Manager costs are spent on back-office administration and accounting
- A manual portfolio valuation via fax/phone costs circa €50.- and just €1.50 if automated
- It costs 17 cents to process a US mutual fund order, compared with approx €100 for a European fund order
- Approximately 1-2% of all faxes are lost
- Across Europe, the direct cost of re-keying manual orders (over 50% sent manually) is more than €1 billion per annum
Solution
SWIFTNet Funds offers very attractive advantages to clients. Substantial effort has been put into the development of new Funds specific standards. These standards are based on UNIFI (ISO 20022) - SWIFT's open XML standards - and consequently benefit from a common well-defined structure. The new solution operates on SWIFTNet, a highly secure and reliable network.
- Incentage has a strong focus on accelerating the adoption by the funds industry of this important initiative, working closely with SWIFT on the new XML based standards, on connectivity to SWIFTNet – and on business analysis of the issues facing funds participants.
- Clients need not worry about the syntax. Incentage can go to the source of the data - be it on a database, in MQ messages or on proprietary systems - and transform that data into fully valid messages. It can also highlight missing data, enhance incompatible data and consolidate diverse data.
Benefits
Incentage flow manager for SWIFTNet Funds helps to achieve full STP rates in handling funds, domestically as well as crossborder wise:
- Provides fully integrated solutions of the highest quality without the need to program
- Minimizes the effort involved in participating in the SWIFTNet Funds solution
- Avoids the headache of changing (and improving) standards, keeping you to date with emerging standards and assessing the impact for you
- Provides fully integrated solutions that are always at the forefront of standards and technology
- Benefits from our experience with SWIFTNet and the SWIFT Standards XML
