Responding to industry calls for further standardisation
FIX Trading Community, the non-profit, industry-driven standards body at the heart of global financial trading, today announced the launch of a new set of message types to further support periodic future payment management in the post-trade space.
The process for periodic payments and cash flow operations management has been, and still is a heavily manual and fragmented process, with multiple different ways in which firms communicate and agree on expected future payments. For example, an expected coupon payment on a swap contract when calculated needs confirming between trading parties. The introduction of a new set of FIX standard messages will allow firms to send and receive details relating to expected periodic payments, a process which is done prior to any physical cash movement or remittance instructions. Allowing firms to maintain a standardised message language further down the post-trade lifecycle enables a host of operational efficiencies.
Laurence Jones, Co-Chair of FIX Trading Community’s Global Post-Trade Working Group and Director, Post Trade Strategy at Traiana, said: “This is several years in the making and has gained a huge amount of focus in the industry in the last 12 months. Through the FIX Trading Community, we have created a new industry subgroup to focus on post-trade innovation and have explored ways in which we can adopt the FIX Protocol as a standard in this area. The post-trade space has seen huge technological investment, but several areas have seemingly been left short. It’s incredibly exciting to see the industry continue to collaborate and be part of improving a process, especially when it offers a whole range of benefits across liquidity management, STP and control. In a time where regulation dominates a lot of decision making in this industry, that’s incredibly important.”
Lou Rosato, Co-Chair of the FIX Trading Community America’s Regional Committee and Director in the Global Investment Operations Group at BlackRock, commented: “FIX Trading Community has long been a market leader in setting messaging and language standards for pre-trade, execution and post-trade across a host of different asset classes and functions. The natural next step is to continue looking further down the post-trade chain into asset servicing and reporting standards which help the industry reduce risk and operate more efficiently.”