The European Fund and Asset Management Association (EFAMA) today published in cooperation with SWIFT, 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 in 2014.
The report confirms that the automation rate and the use of the ISO standards in the fund industry increased to 82.6% (from 79.8% in December 2013), reaching a new all-time high.
The report is part of an on-going campaign by EFAMA and SWIFT to highlight the advancement of automation and standardisation rates of orders of cross-border funds. 29 TAs from Ireland and Luxembourg participated in this survey.
The total automation rate of processed orders of cross-border funds reached 82.6% in the last quarter of 2014, which represents an increase of 2.8 percentage points (p.p.) compared to the fourth quarter of 2013. The use of ISO messaging standards rose by 4.5 p.p., while manual processes and FTP rates dropped to 17.4% (-2.8 p.p.) and 33.2% (-1.7 p.p.) respectively, in the same time period.
The total automation rate of orders processed by Luxembourg TAs reached 81.3% during Q4 2014, compared to 76.6% in Q4 2013.The ISO automation rate remains stable at 57.9% in Q4 2014. The rate of proprietary FTP increased to 23.4% against 18.8% in Q4 2013, while manual orders decreased to 18.7% against 23.4% in Q4 2013.
The total automation rate of orders processed by Irish TAs remains stable with 85.6% in Q4 2014 compared to Q4 2013.
Peter De Proft, EFAMA Director General, says: “As we have seen in previous years, the funds industry continues to move towards more automation and standardization in the processing of cross-border fund orders. By relying less on manual processing, fund managers thus increase the efficiency of their operations, which helps reduce their overall costs and increases the potential return of their funds, and is a very positive development.”
Fabian Vandenreydt, Head of Markets Management, Innotribe and the SWIFT Institute, SWIFT, adds: “The industry is making great strides towards full automation of the funds order process. Similar to other business areas, the adoption of standards and the move towards automation significantly reduces the costs and risks commonly associated with manual processing. It is great to see comparable progress in the funds industry, particularly the work SWIFT has done in collaboration with EFAMA, which is clearly paving the way to more efficient back office operations across the funds distribution process.”