Future of Finance


Why South African fund services infrastructure Finswitch is (no pun intended) switching to blockchain

Why South African fund services infrastructure Finswitch is (no pun intended) switching to blockchain

It is not hard to see why centralised financial market infrastructures are more alive than other financial institutions to the opportunities and threats of distributed ledger technologies. They are the neutral entrepots through which data flows between participants in every financial market so, if every market participant can access the same data simultaneously, the occupation of any provider intermediating point-to-point data flows comes into question. In this environment, the wise market infrastructure chooses to disrupt itself before it is disrupted by others. This is the course taken by Finswitch, the financial market infrastructure that provides the South African fund management industry with pricing, transaction processing, income distribution and data services. It is transitioning to a blockchain-based platform which its leadership and shareholders believe will reduce friction and costs and create opportunities to develop new services. Dominic Hobson, co-founder of Future of Finance, spoke to Nick Baikoff, managing director of Finswitch, about why the organisation is adopting blockchain and how it is bringing its shareholders and users with it.   

Important Questions asked

1. Who and what is Finswitch?

2. Who are the users of the service?

3. How would you say the structure of the South African fund markets differs from say, the UK or Australian or even US markets?

4. Who owns FinSwitch?

5. What was the attraction of moving to blockchain?

6. What other principles You adopted as you shaped this project?

7. Where has the project actually got to?

8. Why did you choose to work with FNZ?

9. How difficult is it to actually move from your legacy technology platform to a blockchain based platform?

10. How much investment spending has this imposed on your users?

11. What new services are Finswitch going to be developing?

12. South African banks are working on a digital identity project. Does it interest you to be involved?

13. How are you handling the cash side of settlement on a blockchain?

14. Do you see cross border fund investing as a major growth access for FinSwitch as you look into the medium and long term future?

15. What next for Finswitch?