FundSettle, the mutual fund order processing service owned by Euroclear, has expanded its reach beyond third-party funds to include clients’ in-house funds for the first time. Euroclear believes it will encourage users to centralise all of their fund-processing business with the Brussels-based ICSD.
Euroclear says it has introduced a low-cost, sliding-scale tariff has to encourage users to support the new initiative. The ICSD says the price cuts are equivalent to a reduction of a minimum 60% on the servicing tariff for third-party funds. It says no other fund-industry service provider offers specific pricing for in-house fund-transaction processing in this manner.
In-house funds – where the fund distributor and fund promoter are part of the same company – represent around 80% of all funds in the industry, says Euroclear.
“While third-party fund processing on FundSettle continues to grow – by more than 140% in the past year, in fact – client demand to centralise all of their fund-processing business, including their own in-house funds, has reinforced FundSettle’s role as the leading market infrastructure for fund-transaction processing,” says Ivan Nicora, Director and head of Investment Fund Product Management at Euroclear Bank. “We are delighted to be able to serve the market’s needs for both third-party and in-house funds in this way.”
Launched in November 2000, FundSettle aims to automate and standardize the processing of offshore and domestic fund subscriptions, redemptions, transfers and switches in Europe.