OJK and KSEI Inaugurate S-INVEST Liability for Advanced Stage

INDUSTRY.co.id - Jakarta - The Financial Services Authority (OJK) together with PT Kustodian Sentral Efek Indonesia (KSEI) formalizes the obligation to use the Integrated Investment Management System (S-INVEST) for Basic Asset Transaction activities as stipulated in OJK Regulation (No. POJK). 28 / POJK.04 / 2016 on Integrated Investment Management System.

The effectiveness of the imposition of such obligations is the advanced stage of the obligation to use the S-INVEST Routing Order module for the Investment Product Transaction which includes sales activities, repurchase / settlement, investment transfer and / or sharing of economic benefits of Investment Products which have been in effect since 31 August 2016.

"Meanwhile, in the advanced stages, S-INVEST users must use Post Trade Prosessing (PTP) module for each Basic Asset Transaction activity as of August 31, 2017," said Syafruddin, Director of KSEI, in the "Inauguration of S-Invest Service for Transaction Activity Basic Assets "at the Indonesia Stock Exchange Building (IDX), South Jakarta, South (05/09/2017).

Basic Asset Transactions are activities related to the investment / divestment of assets underlying investment products, which prior to going through S-INVEST Mutual Fund industry actors must use fax or email as a communication tool for activities related to Basic Asset Transactions, such as trade details, tade allocation, trade confirmation and settlement instruction.

"With the implementation of PTP module in S-INVEST, all activities can be done electronically and centrally using S-INVEST," Syafruddin said.

Syafruddin pointed out, with the enforcement of S-INVEST obligations for Basic Asset Transactions, the business management of investment management industry is expected to be more integrated. Router Order Module and PTP module in S-INVEST are built to realize a centralized and integrated market mechanism so that it can run effectively and efficiently.

The S-INVEST module is developed in accordance with industry requirements as well as targets set by OJK. This is a form of KSEI's commitment to continue to support the development of capital market infrastructure.

"S-INVEST Services are applied to activities that include Basic Asset Transactions as referred to in POJK No. 28 / POJK.04 / 2016 covering investment and divesting assets underlying Investment Products, allocations, installation process / matching Securities Transaction settlement instruction, transaction confirmation and completion instructions. To be able to use this PTP module, User S-INVEST must also have signed an agreement with KSEI," Syafruddin said.

Preparation of the implementation of this PTP module has been started since early 2017 in the form of a series of activities such as socialization, development in KSEI as well as in the back office of S-INVEST users, hands-on training until the testing process. Thanks to the good cooperation between KSEI, S-INVEST User, working group and other related associations, and with OJK support, the PTP module has been effective for use since August 21, 2017.

The implementation of S-INVEST in 2016 is a milestone in Indonesian Capital Market. The reason, the capital market industry for the first time has an integrated system for investment management industry. This integrated system helps capital market regulators to conduct supervision, especially the more consolidated capital market investor data in KSEI.

Based on KSEI data, as of the end of August 2017 the number of Single Investor Identification (SID) has reached 1,042,783 SID (as of August 31, 2017), up 33% from the previous year which amounted to 782,511 SID (as of August 31, 2016). Of these, 563,729 investors have investment production recorded in S-INVEST.

Since the implementation of S-INVEST in 2016, the Mutual Fund industry in Indonesia recorded quite positive growth. Based on KSEI data, Asset Under Management (AUM) 2016 - 2017 increased 21.55% from 328.68 trillion (per July 22, 2016) to 399.52 trillion (as at 31 August 2017). The products listed in S-INVEST also increased by 44% from 1,472 (as per August 2016) to 2,119 (as per August 2017).

In the meantime, Sujanto, Director of Investment Management of OJK (Financial Services Authority), gives appreciation to market players, working groups and other related parties for their cooperation and contribution so that PTP S-INVEST module has been successfully implemented.

"The investment management industry continues to grow. The total net asset of Mutual Funds has reached Rp406 trillion, and when added with other fund investments the total amount could reach Rp622 trillion and it will continue to grow. To respond to these challenges, the synergy between regulators, market participants and stakeholders is needed for the benefit of investors," said Sujanto.

The presence of S-INVEST is expected to realize uniformity and minimize data errors, duplication of investor data or failure of transaction data submission. Sujanto hopes, in the future S-INVEST can integrate with other capital market system either existing or to be developed. (Abraham Sihombing)