I have written before about EMXCo the messaging system for Unitised Funds owned by Euroclear and how they continue
to add new important institutions and intermediaries onto their system. It has just been announced that Legal & General
(L & G) are making all their funds available over the network. This is really great news for the funds industry and should
encourage any remaining sceptics that EMXCo is the place to go.
Its funny how, despite the outstanding success of EMXCo it appears that there are still some people are willing to
doubt this initiative. I suspect its more a question of these people being unable to see that change is necessary and that
EMXCo can thrive in a world dominated by SWIFT.
I wrote a few months back about the EMXCo settlement messages and how this great development makes use of Euroclear
to provide the Funds industry with STP in an area loaded with archaic operations. With L & G now immersed in EMXCo could
this accelerate the wider user of the settlement service?
EMXCo and Euroclear have to be congratulated on their continuing success, which I understand has shown a 24% increase
in messaging volume, than at the same stage last year. Fantastic as the market has hardly been buoyant. Nearly 23 million
messages were going through the system in 2008 and they look on course to push towards the 30 million mark this year. Although
this is mainly UK I have noticed that the European volume is also increasing.
It’s worth noting that radical change has been made to an almost Victorian business by the skill and willing
of the visionary financial services firms that originally funded EMXCo. The early years were not easy and many mistakes were
made but also some exceptionally good planning and management turned the ship around. Now Euroclear are able to add some impetuous
to an already successful company to take it to the next level.
What is the next level?
In my view the next level is to further increase the messages to cover the EU markets and perhaps venture even further
into other international markets. The increased use of the settlement messages is almost a given and will further cement EMXCo
in the global funds business.
However, I believe there is one area that should be worked on, which I perceived some time ago, which is the lack
of a liaison group within EMXCo for software vendors. I believe EMXCo should work more closely with software vendors to ensure
that the capability for EMXCo messaging is within their systems functionality.
They should also consider a possible tie up with Microsoft which could open up the IFAs to low cost connectivity
and further ventures into building solutions for those firms now entering financial services like Tesco as they clearly have
a plan for entering the business, offering low cost new funds to their customers.
Well done EMXCo, keep up the good work!
By Gary Wright, MSI