The Securities and Exchange Commission (SEC) plans to license e-payment securities settlement information service providers, a move that is expected to ease brokerage companies' back office workload.
According to a SEC statement yesterday, the commission will require the operators with high credibility or public trust to have at least 100 million baht of registered capital, hold an e-payment licence from the Bank of Thailand and have a system that can link all commercial banks.
Currently, each securities firm manages information related to stock transactions they themselves execute. On a daily basis, they have to individually contact every bank to clear and settle their trading transactions.
The licence holders providing information on e-payment for securities transactions will act as intermediaries between brokers and commercial banks.
Pattera Dilokrungtirapop, chairwoman of the Association of Securities Companies (Asco), said securities brokers and the Stock Exchange of Thailand (SET) have intimated that the intermediary may be similar to Thailand's ATM pool, which allows customers to withdraw cash from terminals of every bank in the network.
"The system is tentatively called ATS (Automatic Transfer System) Pool. It looks like an ATM pool, but it will pool all trading transactions from brokers through one company, which will then settle them with the corresponding banks," she said.
The pool will also facilitate the SET's plan to shorten the securities settlement period to two days, or so-called T+2 settlement, from three days at present.
But investors will still have to open accounts and make payments through banks as usual.
A source at a securities firm, who chose to remain anonymous, said the SET is considering whether to delegate the operation to its subsidiary Thailand Clearing and Settlement House or to set up a new company.
The SEC is conducting a public hearing and will gather input from securities firms over the next month. The SEC expects the service to be up and running by year-end.