Sebi's standardised reporting format for brokers, others to save Rs 200 crore over 5 years

Markets regulator Sebi on Wednesday said its initiative of a standardised reporting format for brokers, clearing members and depository participants is expected to save more than Rs 200 crore over the next five years while reducing reporting requirements for these entities by 90 per cent.

The new standardised file formats termed Unified Distilled File Formats (UDiFF) enhance efficiency, productivity and interoperability at reduced costs, Sebi said in a statement.

Trading members, clearing members and depository participants (collectively 'members') are required to file multiple reports daily for processing various types of transactions, with their respective Market Infrastructure Institutions (MIIs) -- exchanges, clearing corporations and depositories.

Earlier, members had to file reports in over 200 different proprietary formats for processing various types of transactions leading to significant operational complexity and higher costs.

To promote ease of doing business and to facilitate cost-effective innovation, Sebi undertook an initiative on rationalisation and standardisation of these reports. As a result, the total formats have been reduced from over 200 to 23.

The new standardised file formats or UDiFF, which is in conformity with international ISO standards, have been implemented in a phased manner.

To facilitate a smooth transition for members and the markets, there was a parallel run of the existing system for nearly two quarters, and the old file formats were phased out in a staggered manner, Sebi said.

The new format introduced by Sebi offers several key benefits aimed at improving efficiency and reducing costs in the securities market.

By standardising and reducing the number of reporting formats by over 90 per cent it significantly enhances ease of doing business for brokers, clearing members, and depository participants.
The new initiative is estimated to save "over Rs 200 crore over the next five years to the market ecosystem owing to lower operational expenses", while also lowering integration expenses for new fintechs.

The seamless transition to UDiFF, ensured by a parallel run of old and new formats, has streamlined the flow of information among MIIs and improved regulatory oversight.

Additionally, the format offers flexibility, making it adaptable to future regulatory needs, and contributing to a more efficient and future-ready market ecosystem.