FundsDLT: Natixis AM tests blockchain technology

On June 16, Natixis Asset Management announced that it had started testing the FundsDLT blockchain¹-powered platform for fund managers.

Announced in Luxembourg in December 2016, the FundsDLT concept is the result of collaboration between Fundsquare, InTech (subsidiary of POST Group) and KPMG Luxembourg. FundsDLT is the market infrastructure solution of the future that will meet the needs of both asset managers and international distributors, and streamline a range of fund administration, order-routing and fundholder register management tasks by using blockchain to automate several processes in a secure manner.

FundsDLT is able to:

• Potentially apply to all mutual funds, whether they are domiciled in France, Luxembourg or elsewhere,
• Manage back-office operations for all potential mutual fund distribution circuits (BtoB, BtoBtoC, DtoC, etc)
• Be implemented relatively simply via modern APIs that will facilitate roll-out across the asset management universe, including distributors, fund administrators and depositaries.

FundsDLT should enable asset managers to significantly reduce operating costs currently paid by funds for issuers’ centralizing operations, transfer agent and accounting holding operations, and this will ultimately benefit investors.

The other fundamental characteristic of FundsDLT is that for the first time, distributors and asset managers will be able to share identification of end investors, enabling fund managers to adapt their product offering more easily to investors’ requirements and better support distributors via value-added services (real-time analytics on amounts distributed, financial data reports, alert management, etc.).

It has taken less than a year to build a scalable and resilient decentralized solution dedicated to the fund industry, using state of the art technologies, and a combination of blockchain and reactive platform.

Matthieu Duncan, CEO of Natixis Asset Management is enthusiastic about the project: “We are delighted to be among the first asset managers to test the FundsDLT platform. The initiative is truly unique and we see it as a natural development that will certainly impact our operational models and benefit our clients. Blockchain technology, which Natixis is looking into across several of its business lines, shows great opportunities in terms of enhancing distribution mechanisms in the asset management industry.”