Laxmi Capital News
Automated online trading system from July 17

Nepal Stock Exchange (Nepse) hasannounced that it will bring the fully-automated online trading system intooperation from July 17 in parallel with the existing computerized tradingsystem.

According to theNepse, the much-awaited fully-automated online trading system is now almostready for implementation. The stock exchange company, which has been facingcriticism from the investors for its delay in implementation of the modernonline trading system, has released a new schedule for implementing the system. 

Thefully-automated trading system developed by YCO Pvt Ltd, an informationtechnology firm, will allow investors to place their orders to buy or sellshares online, while everything -- payment, clearing and settlement – can becarried out electronically. 

MurahariParajuli, the spokesperson for Nepse, told Republica that the new system canhandle nearly 23,000 transactions in a millisecond compared to an estimated150,000 orders that the current system can accept in a day.

According to thenew schedule, Nepse will make a presentation about the new system to thebrokerage firms on July 3 and to investors group the next day. Thefully-automated online trading system will undergo internal test between July 2and July 4. From July 5 onward, the fully-automated trading system will comeinto operation through Nepse server.

Nepse hasalready invited bids from eligible bidders for user acceptance testing (UAT) ofthe new system to ensure that the system delivered by the YCO Pvt Ltd canhandle required tasks in real-world scenarios in line with Nepse’sspecifications. UAT will also go hand in hand with parallel implementation ofnew and existing trading systems, according to Nepse officials.

The full-fledgedimplementation of the new system will start upon completion of UAT, accordingto Parajuli.

Parajuli saysthat Nepse was hopeful that at least 10 brokerage firms will be able toimmediately provide the new trading system in parallel with the oldcomputerized trading system.

From July 17,investors can place order from both fully-automated online trading system andthe old computerized trading system.

However, theenforcement of the Nepse online trading system largely depends on the readinessof the brokerage firms who have been saying that it takes them at least fewmonths to set up necessary infrastructures as required by the Nepse.

“None of thebrokers have the hardware and infrastructure to implement the new system. Norit is something that can be done overnight. However, talks are underway to getdata center and other necessary services in lease as it takes some time toprocure it which will allow us to provide our service through the automatedonline trading system in parallel with the computerized trading system,” PriyaRaj Regmi, the president of Stock Brokers Association of Nepal (SBAN), toldRepublica. “However, we have to see the scalability and the volume of thebusiness for setting up infrastructure,” he added.

He estimates thecost of setting up infrastructure and other hardware could be at least Rs 20million and that it would take at least three months for the new system to meetthe specification prescribed by Nepse. 

“We have to docost-benefit analysis of the investment that is nearly equal to our paid-upcapital. Nepse should not prescribe high-tech specifications. It should reviewit,” he added.

Source: MyReublica, 24th June 2018

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