Summary
Marketnode, an SGX-Group & Temasek joint venture, is a digital markets infrastructure operator with 3 distinct product pillars focusing on funds, fixed income, and structured products.
Within the fund space, in August 2022, Marketnode launched an industry-wide funds utility – Fundnode, to improve fund settlement efficiency. Fundnode transforms the industry by digitising and standardising fund flows, centralising information exchange, orchestrating cash & units transfer, simplifying the settlement value chains, building a single source of truth on fund data, and bringing transparency and efficiency to fund investments.
Description of fintech solution
Fundnode is Singapore’s fund settlement utility for public and private funds built on Distributed Ledger Technology (DLT).
As a central utility connecting to all stakeholders of the fund industry, Fundnode digitises all fund order placement and fulfilment workflows, eliminating the need for manual interventions, reduces errors, and significantly speeds up the settlement process. As a result of Fundnode, settlement time is expected to reduce from the current 7 days, down to 2 days.
This fund settlement utility addresses critical pain points unique to the Singapore fund industry, including challenges posed by multiple bilateral networks, silo information storage, and inconsistent workflow. High usage of outdated technologies such as fax and paper handling for order placements and processing often leads to inefficiencies, manual handling, and extended settlement dates.
Describe your key innovations
Fundnode represents Asia’s first fund settlement utility built on DLT.
Tackling a set of unique challenges of paper and fax handling in Singapore’s fund order placement and fulfillment chain, Fundnode creates a fund settlement ecosystem, building digital connectivity with all stakeholders in the industry. This eliminates all reliance on outdated fax-based methods, replacing them with streamlined system data automation.
In addition, as Fundnode’s platform is built on DLT, the solution future-proofs the industry, allowing for exploration into use cases of tokenized and digitalized funds.
Solution Lifecycle
Pilot
Founder's Background
Singapore Exchange (SGX): https://www.sgx.com/
Temasek: https://www.temasek.com.sg/en/index
Founded (Years of Incorporation)
2021
Presence In Region
ASEAN
Asia
Southeast Asia
Technology
Application Programming Interface (API)
Artificial Intelligence
Blockchain
Cloud solutions
ESG
Machine Learning
Natural Language Processing (NLP)
HQ Country
Singapore
What are the top 3 key benefits your solution will bring to the Asset Management Industry?
1. Streamlining and standardisation of fund order placement and fulfilment journey
Consolidation of all order placement and fulfilment through Fundnode allows for central storage of all information and standardisation of all processes, leading to an efficient settlement model with quick turnaround.
2. Optimisation of fund’s Total-Expense-Ratio in the long run
Minimisation of manual handling and reconciliation efforts, leading to significant cost savings and a more agile operational environment for asset management firms.
3. Unlocked trapped liquidity
Reduction in settlement cycle from 7 to 2 days allowing for quicker deployment of funds by fund manager into underlying investments, and a higher churn through quicker order placements by investors with redeemed monies
Tell us more about your past client engagements to date and your market penetration?
In August 2022, the launch of Fundnode was announced by Singapore Funds’ Industry Group (SFIG), with a total of more than 20 participants for the pilot phase. Fundnode is expected to be operational end of Q3 2023. For more information, kindly refer to the announcement below.
https://imas.org.sg/press_releases/singapore-funds-industry-group-sfig-announces-launch-of-dlt-based-investment-funds-settlement-utility-and-code-of-conduct-for-fund-directors/
Do you have any case studies of your solution? If yes, please share it in less than 200 words
As highlighted in the October 2021 case study conducted by PWC and MAS, Singapore stands as a dynamic hub for asset and wealth management in Asia, primed for upcoming expansion.
The study identified three significant pain points that hinder future growth and impact the fund ecosystem. These encompass operational inefficiencies and cost-related concerns, incongruities in fund settlement procedures, and rigidity in adapting to evolving landscapes and changing requirements. Marketnode was approached to build Fundnode, aimed at addressing the issues and challenges in standardising Singapore's fund settlement workflow and embracing new technology through blockchain initiatives.
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