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Subject: RE: Auto-reconciliation - the killer app - go for it!
Mike The situation that Todd Boyle describes is already in use in the UK securities market and I will try to explain the business model in generic terms as I believe that it could well be included under the General Business Requirements as a model for secure transactions between members of an electronic community with a central record archive and a trusted third-party to provide assurance for non-repudiation of contracts. A central industry hub (CREST) provides a service whereby industry participants (who can be securely identified by the hub) are able to submit a message detailing a transaction they claim to have undertaken with another participant. The messages submitted by each party to the transaction are matched on the basis of mandatory fields. The hub provides status update messages to the transaction participants. As soon as matching occurs the trade is available for settlement on the due date (one of the mandatory fields). The hub has real-time access to a record of the resources being exchanged in the transaction (cash and securities). When the due date is reached the hub checks to see that each party has sufficient resources to complete the transaction and, if so, issues messages to the custodians of the resources (cash and securities) instructing settlement to take place. The central hub holds messages, copies of which can be downloaded by the participants and imported into accounting systems, of all aspects of the transaction. Each participant is therefore using an identical record to update their internal systems and no reconciliation is required. The central message is archived after 60 days but can be recovered by the hub (as a trusted third-party) to prove that a contract existed between the parties and the terms of the contract. In B2B transactions I think that the third party assurance of non-repudiation is critical to the global roll-out of eCommerce. firstname.lastname@example.org 19-21 Great Tower Street, London EC3R 5AR Tel: +44 207 929 7600 Fax: +44 207 929 7601 Mobile: 07775 564166 http://www.stpsolutions.com
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