NEX launches automated netting settlement service

Service launched for over-the-counter FX trades, with plans to expand into all asset classes.

NEX Group’s Optimisation business has launched an automated settlement netting service for over-the-counter FX trades.

It was designed to streamline the bilateral process for market participants and provide complete visibility of the payment preparation process for net and gross trades. 

The service uses Traiana’s technology and looks to minimise intra-day settlement exposure, reduce settlement fails and ensure more certainty of funding needs.

Data has shown settlement failure rates stand at approximately 3% for the $1.5 billion settled on a daily basis between clients and dealers.

NEX said the service will eliminate the manual process of netting between clients and dealers through an API to improve communication.

Joanna Davies, managing director at Traiana, explained the settlement netting service will allow traders to execute with any bank on any trading venue, for “optimised, efficient, automated and consistent post-trade processing from execution through settlement.

“Settlement netting processes have traditionally been fragmented across organisations and asset classes, requiring extensive manual processing, which does not reflect the way in which the market is moving,” she said.

NEX added it plans to expand the service across all asset classes in the future.