Connecting Custodian Banks and Brokers: The Elysys Bank Gateway Story
In the ever-evolving landscape of financial technology, the need for seamless data integration is more critical than ever. Enter Elysys Bank Gateway (EBG), an innovative solution designed to connect all your custodian banks, brokers, and aggregators through a single, unified channel.
EBG automates the flow of data from third parties directly to your integrated portfolio management system, leveraging state-of-the-art technology to ensure rapid and flexible add-on connections to new parties.
This blog will delve into the origins, development, and future of EBG, featuring insights from its founder Maxime Caty and Stéphane Matton, a Single Family Office financial controller.
The Genesis of Elysys Bank Gateway
Let’s explore the origin of the development of Elysys Bank Gateway with its creator Maxime Caty
Q: What triggered the creation of EBG?
MC: The creation of EBG was triggered by the need for a more efficient and standardized way of gathering Investment portfolio data, such as movements and positions. I recall a conversation with Max Wattel, Elysys Financial System Managing Director, soon after I joined Elysys, where he highlighted the benefits of automatic data gathering. He sketched a common table design on a whiteboard, leading to the idea of creating a unified bank interface. This would streamline data integration into Elysys products and eliminate the need for repetitive and costly development for each individual bank.
Q: What specific needs and requirements did the customers have that influenced the development and design of EBG?
MC: Customers needed a system that could efficiently provide a list of bank accounts, along with their positions and transaction histories. These features would significantly assist back-office teams with reconciliation and accounting tasks, providing a clear view of financial activities.
Q: Can you identify the fundamental elements and guiding concepts of the system architecture? What were the reasons behind these decisions, and what challenges arose during their implementation?
MC: The system was designed with robustness and security as primary principles, ensuring smooth and secure data delivery to customer systems. The architecture is based on a lower technical layer common to any bank interface, including connection protocols, cryptography, and file handling. This design allows new bank interfaces to leverage existing features, reducing development and testing time. A significant amount of effort was devoted to developing a communication and data-sharing architecture as a common component. However, there were technical challenges, particularly regarding cryptography, during the foundational work.
Ensuring Functionality and Security
Q: Can you describe how the system was tested to ensure its functionality and security, and how it was connected to banks?
MC: The lower technical features and architecture were rigorously tested during the deployment of the first bank interfaces, resulting in a robust and reliable component. When a new bank interface is deployed, we connect to the customer's system and request that they perform additional verification using their real statements. This helps identify any issues that may have been overlooked.
Q: What specific improvements were made to the system to enhance its performance and functionality?
MC: Over time, we identified and addressed minor issues that affected system stability. While performance was satisfactory from the start, improvements focused on enhancing stability. For instance, we developed an advanced error detection system. This system automatically attempts to restart failed jobs and sends notifications if an error occurs multiple times.
Looking Ahead: The Future of Elysys Bank Gateway
Q: What are the prospects for the system's future development?
MC: The initial prospect is to expand the coverage of banks, assisting institutions with reconciliation and accounting. In the future, we aim to develop a two-way system, allowing users to book orders or trades with banks through EBG. This would eliminate the need to juggle multiple bank platforms for transactions. However, this development would pose significant challenges in terms of security and the integration work required with existing Elysys products.
User Experience: Insights from Stéphane Matton, PhD, CFA, Family Officer at Single Family Office.
For insight from a user, we conducted an interview with Stéphane Matton, who was among the first to utilize Elysys Bank Gateway.
Q: What advantages or benefits have you observed since implementing EBG?
SM: The main advantage of using Elysys and EBG is to have a centralized and automated system for managing the bank flows and the accounting entries, as well as a consolidated reporting of the family's assets and expenses.
Q: What are the challenges or issues you encountered while using EBG?
SM: The automation can be setup to also automate the posting process. I find that manually posting the bank flows from EBG to the journals allows for greater control and precision, ensuring that all lines are accurately accounted for.
Q: Based on your experience, do you have any specific suggestions for improvements or recommendations to enhance EBG further?
SM: A suggestion for improvement is to have more resources and flexibility for the mapping and the maintenance of the files, and to ensure the accuracy of the securities and the prices. Also, since I use Elysys Analytics for the reporting, enhancing traceability and consolidation of the flows would be beneficial.
Final thoughts
Elysys Bank Gateway stands at the forefront of financial data integration, offering a robust, secure, and flexible solution to connect custodian banks, brokers, and aggregators. With ongoing enhancements and a commitment to addressing user needs, EBG is poised to remain a key player in the financial technology landscape. Stay tuned for more updates as we continue to innovate and expand our capabilities.
We are grateful to Stephane and Maxime for their contributions and the time they dedicated to providing us with feedback.