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Digital utility shown to dramatically lower MiFID data costs

MiFID II, data management, EMTA digital utility has managed to lower data management costs related to MiFID II by over £100,000 (€110,000) for firms involved in the project.

The firms – which include the fund platform Allfunds and asset manager Fidelity International – belong to the Tisa Universal Reporting Network (Turn), which has officially launched.

Described as an industry-run utility, Turn’s aim is to ease regulatory reporting requirements of MiFID II and is now available across Europe based on blockchain technology. 

The participating firms – which also include transaction network Calastone and Deutsche Bank - have disclosed that their data management costs averaged £200,000 per year until adopting Turn, after which the costs fell to less than £30,000 per year.

The exact cost for the firms depends on the size of the firm and whether they are a member of Tisa – The Investing and Saving Alliance. 

Link Group, MFEX, KNEIP, Transact Deutsche Wealth Services, FNZ and Fund Connect are also users of the facility.

Before the building of Turn, the exchange of information was inconsistent, and firms struggled to obtain all the data they required from other firms to enable disclosure of investment-related costs, Turn said. This led to a lack of transparency and inappropriate products being marketed to retail investors. 

But with Turn, the firms have access to the European MiFID II Template (EMT) on a real-time basis and of a higher quality, Turn said.

Additional functionality beyond MiFID II is planned, including ESG data and a tool to manage the Packaged Retail and Insurance-based Investment Products – or “Priips” – rules. Geographical expansion is also planned.

Gary Bond, CEO of Turn, said: “The impact Turn will have for asset managers, distributors, IT firms and other platforms across Europe is huge.”

Matt Newnham, managing director at MFEX, said: “We are already seeing the benefits of building a fully transparent, immutable and efficient exchange of regulatory and fund data, through a data utility for the asset management and fund distribution industry.”

As part of its development, Turn has also set up a governance board.

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