Banking and insurance software firm VERMEG together with Open Finance pioneer LUXHUB, are announcing a partnership “around the collection and processing of custodian data, available to insurance companies.”
Custodix Hub, “through the combined tech expertise and industry knowledge of both partners, facilitates the flows and financial data exchanges between custodian banks and insurance companies, in a trusted and secure environment provided by LUXHUB.”
The two companies also announced “a successful POC (Proof of Concept) with a leading player in Luxembourg.”
Nowadays, life insurance companies, “as well as other external asset management companies, face key challenges when collecting and processing data from custodian banks.”
Eric Bemelmans, Director, Digital Transformation, at VERMEG. said:
“Data collection represents a significant cost due to the multiplicity of custodians, the use of multiple formats and the volume of transactions or the number of failures that require corrections. Maintenance and scalability of custodian interfaces represents a significant fixed cost and heavy workload for internal teams.”
Another key challenge for insurance companies is “the successful integration of increasingly complex data – position reporting, securities and cash transactions, new asset classes, derivatives, Solvency, etc.”
It requires functional expertise which, “through the innovative partnership and solution, is provided by VERMEG.” Finally, technical expertise “is crucial to master the multiple formats used by the custodian banks: Swift MT or MX files, proprietary formats, XML files, FIX, web services.”
Eric Bemelmans commented:
“Often, the different custodian banks send information in their own format. This requires life insurance companies to execute a recurrent and often manual process of data retrieval, formatting, reconciliation and injection into their Portfolio Management System. With this innovative solution, we are mutualizing the effort, for all insurers, and we will have more impact toward the custodian banks to request more automation. At the end of the day, insurers will be able to continue to focus on their core business.”
Through this partnership, VERMEG’s innovative solution “becomes available in LUXHUB’s central platform, linking insurance companies and depositary banks.” The Fintech, which was built by compliance and continues to be driven by innovation, “offers a seamless flow and exchange of data, in a trusted, secure and proven environment.”
Custodix Hub has actually “been tested by a key local player over the summer, in a Proof of Concept (PoC) project.”
It proved “to be efficient over this period, as it validated the vision and ideas of the life insurance companies, as well as LUXHUB and VERMEG’s ability to help the wealth management industry in its digitalization process.”
For more details, check here.