South Africa: FNZ Unveils Blockchain-based Solution for Funds Sector

Blockchain technology is being utilized for fund trading and settlement solutions by FNZ.

FNZ Unveils ChainClear Solution

According to a recent report by Ledger Insights, FNZ – a firm committed to enhancing client engagement, lowering costs, and delivering a seamless service to aid people achieve their financial goals – has launched ChainClear, a blockchain-enabled fund trading and settlement solution.

Per sources close to the matter, ChainClear will provide a single “source-of-truth” pertaining to the ownership of which is federated among participants, including 140 financial institutions. The use of distributed ledger technology (DLT) will vastly reduce the need for asset managers and transfer agents to reconcile different fund ownership records.

Commenting on the development, Nick Baikoff, Managing Director, FinSwitch, noted:

“The FinSwitch blockchain, powered by FNZ, presents an opportunity to fundamentally re-architect the existing operational topology of the Collective Investment Scheme industry in a way that brings about dramatic improvements in efficiency and cost reduction for all stakeholders, ensuring that costs will be significantly reduced over time, making investments more affordable to the end investor.”

It is also worthy of note that the blockchain-powered real-time automated process will replace the conventional batch processing solution. While the platform is already processing hundreds of thousands of trades and transactions every week, at present, ChainClear is still functioning in parallel to the legacy system.

Hugh Evans, Managing Director, FNZ South Africa, noted:

“This development takes the South African market to the forefront of managed fund servicing globally.”

Further, it is also important to highlight that the ChainClear solution uses the Hyperledger Fabric enterprise blockchain for its functioning.

Hyperledger Fabric: A Leading Permissioned Blockchain

While blockchain technology and decentralization run hand-in-hand, there is also a case for permissioned blockchains that can be used be centralized authorities as per their convenience. Hyperledger is one such permissioned blockchain that has witnessed considerable adoption by corporations the world over.

As reported by BTCManager in September last year, Hyperledger confirmed the arrival of new members such as Visa and SAP to its blockchain project.

On a recent note, BTCManager reported that Telefonica and Alastria had inked a deal that would enable them to develop an enterprise-grade DLT solution powered by Hyperledger Fabric.