The Thai Bond Market Association (TBMA) announced that it is inspired to build a fintech platform using blockchain technology. And it is expected that the new registrar system would reduce more than 50% of the original issuance time.
The new registrar
Combining financial with blockchain technology, the TBMA plans on implementing a new registrar service platform. To improve the growth of the secondary market, the discussions of putting the new system to practice are ongoing. If the President Tada Phutthitada of the TBMA succeeds in applying the regulatory sandbox by the end of 2018, this will be the first fintech platform applied to the Bank of Thailand and the country’s Securities and Exchange Commission (SEC). The President intends to start the live experiments of the new platform under the regulators’ supervision.
The main aim of the platform is to reduce the bond certificate issuing time to 2 days. However, the figure currently lies at seven to fifteen working days. Also, the book entries would represent the holding and settlement of securities. So, it is expected that the new platform will possibly eliminate the need for physical certificates. Phutthitada said,
“The faster bond certificate issuance allows bondholders to trade in the secondary market faster and reduces settlement risk for bond investors. If nothing is done to speed up bond certificate issuance, the growth of corporate bonds in the secondary market could be limited.”
During the initial stage of the platform, users could check several conditions on a bond fact sheet. It would include interest payment, interest rates and many other conditions. In the new phase that is expected to go public in nine months, bond deposits are expected to be serviced. Moreover, the final stage is expected to take a year for completion. And it would introduce Bond Coin, a clearing, and a settlement system.
Thai Bond Market Association (TBMA)
TBMA is a securities business related association which regulates the Thai bond market. Its main purpose is to be a self-regulatory organization (SRO) for a fair and efficient operation of the bond market. It also intends to be an information centre for the Thai bond market.