Bangladesh Securities and Exchange Commission (BSEC) has taken a new initiative to ensure the safety of investors' money in the capital market. Under this initiative, a 'uniform online platform' will be created through which brokerage houses will provide their consolidated customer account (CCA) information to the stock exchanges on a daily basis.
Dhaka and Chittagong Stock Exchanges have already been directed to build this platform and have started working. Under the new system, brokerage houses will collate their CCA account information and submit it to the stock exchange, from where any inconsistencies or laxities will be scrutinized and corrected. As a result, the risk of losing investors' money or shares will be reduced.
BSEC Executive Director Mohammad Rezaul Karim said, if this initiative is implemented, the cases of money or securities embezzlement from the brokerage houses will be reduced. He further said that it will increase supervision and monitoring in the capital market, thereby protecting the interests of investors.
However, there are doubts about the implementation of this initiative among some individuals and institutions related to the capital market. President of DSE Brokers Association (DBA) Saiful Islam said, 'It is not easy to implement this initiative in the context of the current capital market of the country. This requires adequate manpower and time in the necessary technical preparation and platform management.' He warned that if all parties do not cooperate, the plan will not succeed.
Saiful Islam further added, 'In order to implement this process, the cooperation of the capital market stakeholders along with BSEC as well as the central bank is very important. The functionality of the platform should be ensured, so that the risk of loss of money and shares from CCA is reduced.'
While the BSEC's new initiative is laudable, its implementation will require extensive preparation and coordination. Stakeholders hope that, if done properly and in a coordinated manner, it can play an effective role in protecting investors' capital.
Bangladesh Securities and Exchange Commission (BSEC) has sent a letter to Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) on October 31, asking them to report the progress of creating a uniform online platform. According to the letter, a meeting was held on April 29, 2023 with DSE and CSE regarding the launch of uniform online platform. After this meeting, BSEC on October 9 directed DSE and CSE to create the platform. Later on the application of the stock exchanges, the BSEC gave an additional 20 working days (till November 6). BSEC has now asked stock exchanges to report on the current status of creating a uniform online platform.
order to do
The two stock exchanges are directed to develop a uniform online platform, asking the stock exchanges to review the current method of calculating CCA (integrated customer account) and develop a standardized format. This format will be submitted to the commission and will be published on the website of the exchanges.
On the new platform, stock brokers will update their CCA information after the end of daily trading. DSE and CSE will regularly review this information and take necessary action if any discrepancies are found.
At what stage of progress?
Meanwhile, according to DSE and CSE sources, Uniform has started the work of creating an online platform. DSE has already formed a committee and plans to submit a report to BSEC soon.
DSE Acting Managing Director (MD) AGM Satvik Ahmed Shah said that a team consisting of Bangladesh Bank, CDBL, CCBL and Broker House is working to develop the platform. whose research is still ongoing. The report will be submitted to BSEC soon.
Challenges with implementation
Creating an integrated online platform in the existing reality is very challenging. A member of DSE said, it is almost impossible to match the information of back office software of about 900 brokerage houses with the settlement information of Bangladesh Bank.
DSE Director Minhaj Mannan Imon and CSE Managing Director M Saifur Rahman Majumdar mentioned this initiative as difficult and time-consuming. Because, there is no technical preparation in the market.
Meanwhile, Treasury Securities official Mustafa Mahbub Ullah suggested that the brokerage house software should be linked with the investor's bank account to make direct settlement. This will reduce the pressure on the stock exchange.
