The Central Depository and Settlement Corporation (CDSC) is set to launch a new trading platform that will fast track trading on the Nairobi Securities Exchange (NSE).
This is good news to investors who currently have to wait for at least three days for trades to settle. Mature markets like Johannesburg Stock Exchange are already enjoying a same day settlement policy.
The securities settlements platform had initially been expected to go live a year ago, but was delayed to ensure the new system worked seamlessly with the one working on the bourse.
The upgrade will also see CDSC’s system handle more transactions per day, boost the liquidity of the capital market, allowing investors to unlock the value of their investments real time.
Currently, the system is handling only 30,000 transactions per day,
Speaking while unveiling the company’s new corporate identity, CDSC Chief Executive Officer Rose Mambo, the system would be in place by April next year, but brokers will be able to test the system from December to iron out the kinks.
“We’ll go live later this month and proceed with testing and integration with stockbrokers, the NSE and depository agents before we go live,” Ms Mambo said.
‘’The system upgrade seeks to increase efficiency, boost security and remove redundancies. It will for instance address corporate governance to ensure idle investor accounts are not used for illegal trades’’.
She added that the depository working towards product diversification in order to offer multiple products and markets by leveraging on technology and service excellence.
The revamped system is expected to complement Capital Market Authority’s (CMA) securities lending and borrowing initiative, allowing investors to transfer their shares to buyers with a formal agreement on when the shares will be returned at a pre-determined price.
The CDSC hopes to add stocks from bourses in other countries to its depository, starting with Nigeria.
