Fise Connectivity Plan Cost Pegged At Rs 11.34 Crore

The Federation of Indian Stock Exchanges (Fise) has pegged the cost of its ambitious interconnectivity plan at Rs 11.34 crore.

Fise intends to raise the amount by auctioning 10 additional membership cards, which the regional bourses will be asked to issue. The board of regional exchanges is likely to clear the matter before April 30.

Joseph Massey, managing director of the Indian Stock Exchanges Services Corporation (ISESC), the proposed company formed by Fise, said the steering committee has arrived at a transaction cost of Rs 2.50 per trade, which is a significant achievement.

"The approximate transaction cost per trade has been worked at Rs 2.50 which is the lowest among all the existing stock exchanges. We are looking at a target of nearly 35,000 trades per day but our (computer) server has a capacity to handle 1 lakh trades per day," Massey said.

 

The federation plans to generate the project cost from the regional exchanges and, if required, by way of term loans. Massey said that the 12 bourses will be putting in Rs 25 lakh each and a similar amount will be pooled in by members of each exchange.

"If required, we will go in for a term loan. However, we do not think generating resources will be a problem," he added.

Fise has also approached the Securities and Exchange Board of India to take up the issue with Central Board of Direct Taxes to declare investments made in ISESC as approved investments.

Meanwhile, Fise has written to six banks for setting up electronic clearing facility. These are State Bank of India, Bank of Baroda, Canara Bank, Bank of India, HDFC Bank and ICICI Bank. "Of these, two banks -- HDFC Bank and ICICI Bank -- have made presentations and we shall soon take a decision on this matter," Massey said.

Fise steering committee will be meeting on May 3 in Jaipur to ratify the bye laws, business rules and trading rules of ISESC.

Meanwhile, Price Waterhouse is independently working on the project cost and other details of the system.

The recently held meeting at Mumbai was attended by the representatives of Delhi and Calcutta stock exchanges also, though they took part in the deliberations as special invitees.

However, president of the Delhi Stock Exchange (DSE), Paramjeet Singh, has said that the at the moment the bourse was busy with its own expansion plans. "The issue of joining the integrated system has to be taken up with my board. However, there is no question of out being a part of BSE on-line trading system," he said.