Automation rates for cross-border fund orders received by transfer agents in Ireland and Luxembourg are continuing to increase, according to a report from the European Fund and Asset Management Association (EFAMA) and SWIFT.
The survey found that automation rates for fund orders received by transfer agents reached 85.4 percent in Q4 2015, compared to 84.4 percent in Q3. This also marks a significant increase from the 82.6 percent automation rate recorded in Q4 2014.
The 29 transfer agents taking pert in the survey saw their combined order volumes increase by 11 percent from 30.6 million orders in 2014 to 34.1 million in 2015.
Use of ISO messaging standards also increased from 49.4 percent in Q4 2014 to 51.2 percent in Q4 2014.
Automation rates were found to be slightly higher among Irish transfer agents. Of all orders processed, 89.7 percent were automated, compared to 85.6 percent in Q4 2014.
In Luxembourg, this figure was 82.9 percent, a slight increase from the 81.3 percent of orders automated in Q4 2014.
However, the number of automated orders using ISO messaging standards was significantly higher in Luxembourg, increasing from 57.9 percent in Q4 2014 to 65 percent in Q4 2015.
In Ireland, transfer agents saw a slight dip in orders using the ISO standards, from 29.5 percent in Q4 2014 to 26.9 percent in Q4 2015.
Peter De Proft, director general of EFAMA commented: “The continuous progress towards ISO adoption and the impressive 15 percent drop in manual processing of funds orders confirms that the European investment funds industry continued to improve the efficiency of its back-office operations in 2015. This is tangible proof of the industry’s commitment to reduce operational risks and to ensure ever-improving services for its clients.”
Fabian Vandenreydt, global head of securities, Innotribe and the SWIFT Institute at SWIFT, noted that when the first EFAMA and SWIFT report on automation and standardisation of cross-border fund orders was published in 2009, the objective was to reach a “realistic, yet ambitious” automation rate of 80 percent.
He said: “Today, with more than 85 percent of cross-border funds orders automated, the ongoing progress of the transfer agent communities of Luxembourg and Ireland is a testament to the commitment of these markets to become more efficient for the benefit of their clients, and to alleviate the high costs and risks associated with manual processing.”
He added: “With EFAMA’s recommendation of a single ISO standard to be used in the funds industry, we are clearly moving in the right direction, and now is the opportunity to focus on the potential next buckets of automation, namely for transfers and account openings, where we see the biggest potential for standardisation.”
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