New report from EFAMA and SWIFT highlights the evolution of automation and standardisation rates of fund orders during the first half of 2020
EFAMA - the voice of the European investment management industry, in collaboration with SWIFT, has published a new report on the evolution of automation and standardisation rates of fund orders received by transfer agents (TAs) in the cross-border fund centres of Luxembourg and Ireland during the first half of 2020.
The report highlights the progress made towards the increased automation of the amount of fund orders, and the use of ISO standards. Twenty-eight TAs from Ireland and Luxembourg participated in this survey.
The key findings of the report include:
- The total automation rate of orders of cross-border funds remained stable at 91.9% in the first half of 2020. The use of ISO messaging standards dropped from 62.3% in Q4 2019 to 57% in Q2 2020, while the use of proprietary file transfer protocols (ftp) increased to 34.9% in Q2 2020, from 29.5% in Q4 2019.
- The total automation rate of orders processed by Luxembourg-based TAs decreased to 89.4%, from 90.2% in Q4 2019. The ISO automation rate decreased from 76.6% in Q4 2019 to 75.2% in Q2 2020, while the use of proprietary fund transfer protocols (ftp) rose from 13.6% to 14.2% during the same period.
- The total automation rate of orders processed by Ireland-based TAs increased from 94.6% in Q4 2019 to 95.3% in Q2 2020. The ISO automation rate decreased from 36.6% to 33% during the same period, whereas the use of proprietary FTP went up from 58% to 62.3%.
Tanguy van de Werve, Director General of EFAMA, notes: Whereas globally the average automation rate of orders of cross-border funds remained stable at around 90% during the first half of 2020, it should be possible to further reduce the share of orders incoming from the APAC and Americas that are still manually processed. Progress towards greater standardisation in these geographies would reduce operational risks and costs and further increase the competitiveness of UCITS.
Janice E. Chapman, Manager, Investment Funds, Standards, SWIFT, adds: Whilst order volumes have increased overall, the fund volumes of ISO 20022 messages on SWIFT show a slight decrease and this is, perhaps, a reflection of the unusual circumstances facing the world in 2020.
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About the European Fund and Asset Management Association (EFAMA)
EFAMA, the voice of the European investment management industry, represents 28 member associations, 57 corporate members and 23 Associate Members. At end Q3 2020, total net assets of European investment funds reached EUR 17.6 trillion. These assets were managed by more than 34,200 UCITS (Undertakings forCollective Investments in Transferable Securities) and almost 29,400 AIFs (Alternative Investment Funds). At the end of Q2 2020, asset managed by European asset managers as investment funds and discretionary mandates amounted to an estimated EUR 24.9 trillion. More information available at www.efama.org.
SWIFT is a global member-owned cooperative and the worlds leading provider of secure financial messaging services. We provide our community with a platform for messaging, standards for communicating and we offer products and services to facilitate access and integration; identification, analysis and financial crime compliance. Our messaging platform, products and services connect more than 11,000 banking and securities organisations, market infrastructures and corporate customers in more than 200 countries and territories, enabling them to communicate securely and exchange standardised financial messages in a reliable way. As their trusted provider, we facilitate global and local financial flows, support trade and commerce all around the world; we relentlessly pursue operational excellence and continually seek ways to lower costs, reduce risks and eliminate operational inefficiencies. Headquartered in Belgium, SWIFTs international governance and oversight reinforces the neutral, global character of its cooperative structure. SWIFTs global office network ensures an active presence in all the major financial centres. For more information, visit www.swift.com or follow us on Twitter: @swiftcommunity and LinkedIn: SWIFT