Baton Systems Launches Automated Settlement Orchestration Platform

Baton Systems has launched a digital solution providing firms with automated and real-time control of their cash settlements that it says is a “game-changer”.

Core-Payments is already deployed by one unnamed bank according to the firm, and leverages Baton’s DLT (distributed ledger technology) workflows to automatically track and reconcile inbound cash settlements, and to orchestrate the release of outbound cash payments on the basis of configurable rules and real-time data.

“Core-Payments significantly reduces the need for manual intervention across key reconciliation and control processes, including netting and pre-settlement affirmation, accelerating the completion of key functions and reducing operational costs whilst increasing control and visibility,” Baton says.

Critically, it adds, Core-Payments permits users to reconcile inbound and outbound payments in real-time – compared to the industry standard of T+1 or longer. With the shortening of the securities settlement cycle to T+1 in the US now less than 250 days away, Baton says the launch of Core-Payments comes at a pivotal time for market participants, providing them with real-time visibility and greater control of their settlement functions, as well as enhanced cost management and related growth opportunities. In addition, it says, the solution provides continual calculation of counterparty settlement risk exposure, as well as a clear view of current and forecasted funding requirements.

In terms of the technology supporting Core-Payments, Baton says the platform is designed to be deployed in a modular fashion, providing users with a set of user interfaces across a range of modules including Visualisation, Netting/Pre-Settlement Affirmation, Controlled Settlement, and Analytics. Additionally, all data inflows and outputs are supported by a range of APIs and integration protocols. This means that firms can digitally transform their approach to payments and settlement without requiring their counterparties to adopt new technology, it explains.

“With the transition to T+1 now just months away, and with regulators growing increasingly vocal around the need for greater settlement control and supervision, it is paramount that market participants ensure they are fully prepared to cope with any rise in settlement risk,” says Alex Knight, head of EMEA, Baton Systems. “For too long now, legacy processes for monitoring and managing settlement risk have stifled industry progress. Adopting cutting-edge solutions like Core-Payments is a pragmatic first step in, helping firms manage risk, operate more efficiently, lower costs, increase their counterparty footprint, meet growing regulatory requirements, and provide excellent customer service.”