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Blockchain Utility Aims to Cut Asset Management Data and Analytics Costs by up to 90%

• TURN to cut costs by 80-90% per annum, a much-needed reduction as Covid-19 continues to disrupt global markets and create widespread uncertainty.
• Allfunds, Calastone, Deutsche Bank, Fidelity International, Link Group, MFex, and Transact are involved in the building and testing of TURN.
• The utility, powered by Atos, aims to ease regulatory reporting requirements of MiFID II and will be available across Europe based on blockchain technology in Q4 2020.

Performance data from The Investing and Saving Alliance’s (TISA) new digital utility business for the asset management industry, the TISA Universal Reporting Network (TURN), indicates the utility will cut data and analytics costs by between 80-90% per annum from year one. This comes at a time when asset management firms are having to significantly reduce costs because of Covid-19’s impact on global markets and the uncertainty around a ‘second wave’.

TURN is a result of TISA’s MIFID II Project under the oversight of a Governance Steering Committee.

The current participating firms have revealed that to date their data management costs average £200,000 per year, according to a recent statement from the organization, which went on to predict that TURN will immediately reduce these costs to less than £30,000 per year (depending on size of firm and whether or not they are a TISA Member), with a one off £15,000 joining fee (£18,750 for non-members).

TURN also announced that the utility will already be accessible to 60% of the market once it launches later this year, because a number of firms, including Allfunds, Calastone, Deutsche Bank, Fidelity International, Link Group, MFex, and Transact, have already signed up to help with the advisory and testing phases of the new industry-wide platform. Digital transformation firm Atos will operate the bespoke and highly innovative utility, which the organization says will provide a secure data exchange solution for the asset management industry.

According to Gary Bond, CEO of TURN, the initiative will not only provide a solution for the collection and dissemination of EMT regulatory data, but it will also save participating firms notable sums of money which could then passed on to the customer. “It’s fantastic that such industry leaders are joining the network to help build TURN before the testing phase has even begun,” said Bond. “This is an industry-led and run, not-for-profit initiative that will ultimately ensure that consumers are offered the best and most suitable products while lowering costs and time spent on admin for asset managers,” he added.

Sources inside TISA say the industry utility is on course to deliver a demonstration to the industry later this month, with the official launch highly anticipated in early Q4 2020. Its ambition is to ease regulatory reporting requirements of MiFID II and will be available across Europe based on blockchain technology, and all relevant parties will have access to the EMTs (European MiFID II Template) on a real-time basis.

Analysts say that currently, this exchange of information is inconsistent and sometimes firms struggle to obtain all the data they need from other firms to enable disclosure of all costs, and TURN will ensure better transparency of funds so that they can be more easily and accurately profiled, allowing for better comparison between funds on both the genetic makeup of the fund and its costs.

The availability of more transparent profiling, said TISA, is in response to demands by retail investors and will also be of particular use when ESG reporting obligations become a requirement next year.

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