Sri Lankans can now open a securities account instantly with their Stock broker under a new decentralization program by the Central Depository Systems (CDS) eliminating the need to forward application forms and connected documents to CDS and wait for the CDS to open the account and confirm to the stock Broker and for the stock broker to notify the account holder.
This empowerment would grant Stock Brokers a greater level of flexibility to service investors more efficiently and in a timely manner. The CDS recently upgraded its systems to enable stock brokers to create CDS accounts on behalf of their clients, which enables the investor to trade immediately. Stock Brokers have also been given the ability to carry out Broker to Broker portfolio transfers without the intervention of the CDS thus providing convenience of a faster service to their clients.
A CDS account is a pivotal part of trading securities at CSE and new investors are required to open a CDS account before commencing trading. The new process will empower Stock Broker firms to promptly respond to investor requests and work more closely with the investor at the point of opening a CDS account. This will also streamline the KYC process and would fast track registering new investors and offer them the ability to save time and maximize on investment opportunities.
The initiative will reduce the time taken to carry out these functions and enable a faster and smoother service delivery. Stock Broker firms have played a lead role in ensuring a smooth transition to this globally accepted practice which is set to uplift industry standards and place them in par with peers globally. Depositories are expanding on their traditional role, bolstering their service offering and decentralizing functions to offer better value to its stakeholders which were noted in a survey carried out by CDS among members of the Asia-Pacific Central Securities Depository Group (ACG).
Commenting on the initiative the Head of the CDS Nalin Fonseka said, “The decentralization of the account opening and investor portfolio transfer process would provide impetus for greater efficiency. The ‘ease of doing business’ is a key parameter for prospective investors and this initiative would enable Stock Broker firms with the required decision-making ability within the account opening space, which I am certain would foster a greater level of convenience to the Stock broker and the Investor.”
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