Automation rates for fund transactions within Ireland and Luxembourg edged up recently as the industry looks to bring down costs through standardisation and by eradicating manual processes where possible.
The total automation rate of processed orders of cross-border funds reached 86.7% in the last quarter of 2016 – an increase of 1.3 percentage points compared to the year-before quarter.
Peter De Proft, director general of the European Fund and Asset Management Association (Efama), said: “Year after year, the cross-border fund industry is getting closer to their goal of automatically processing at least 90% of fund orders.”
Ireland’s transfer agents (TAs) in fact hit the 90% mark. The total automation rate of orders processed by Irish TAs increased to 90.6% in Q4 2016, up from 89.7% in the same period the year before.
The total automation rate of orders processed by Luxembourg TAs reached 84.4%, up from 82.9%.
The use of manual processes across the two domiciles dropped to 13.3% – a 1.3 percentage point decrease.
Efama, the trade association, and Swift, which promotes standardisation in financial messaging, track the level of fund orders placed using the protocols of the International Organization for Standardization (known as ISO standards), and the extent of automation used to communicate orders.
The two bodies count fund transactions communicated using ISO standards, which increases efficiencies, as opposed to transactions using proprietary formats.
They also study the level of automated processes versus the level of fund orders placed by faxes and other manual processes that are more likely to be costly and lead to errors.
De Proft said the figures showed that faxes and calls were used less and less to place fund orders.
“This is good news because a greater level of automation raises the quality and efficiency in investor services, and reduces operational costs,” he said.
Last year, the total volume processed by the 29 survey participants from Ireland and Luxemburg reached 34 million orders.
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