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Do you speak my language?

STP is the ultimate goal of financial systems integrators but it is also vital for the smooth running of adviser businesses and their client relationships, says Alan Sherriff, managing director, CBoxx Ltd

In my world of financial systems integration the acronym STP represents the idealistic end game for any project worth its salt.

Like every good techie, I’m sometimes guilty of assuming that everyone understands what I’m talking about. Wikipedia states that STP could mean: Scientist Training Program, Shovel Test Pit, Shielded Twisted Pair or even Sewage Treatment Plant.

My favoured definition is: Straight Through Processing, banking term where a financial transaction is automatically completed without manual intervention. This beguilingly simple phrase hides decades of slightly awkward industry meetings in darkened rooms between companies that normally compete fiercely.

CBoxx works with Origo, this industry’s eCommerce standards body, whose purpose is “to facilitate electronic exchange of data between organisations in the financial services industry, making it easy for providers, platforms, portals and advisers to work with each other.” With standardised messages and market practices, organisations agree to speak the same language between their systems and the road to STP becomes clearer.

Nirvana is reached when the long suffering user – adviser/ paraplanner/administrator – can work wholly within their chosen system, without logging in to anything else to re-key information. This saves a surprising amount of time and more importantly, dramatically reduces serious mistakes unwittingly introduced through human error.

Mistakes damage reputations
Mistakes are frequently spotted first by clients. This damages reputations and wastes valuable time for all parties concerned in rectifying the mistakes.

Organisations such as the platforms, life companies and third party administrators recognise the importance of preventing mistakes and often screen them out by setting up manual four-eyes processes to double check every transaction for accuracy. In other words, two people doing one job. This is costly and slow.

Such organisations don’t willingly reduce their profit margins and, of course, they cover their costs through management charges. Ultimately that cost passes up the chain to the consumer via the financial adviser who has to justify it.

After a working life in this arena I can report that progress is being made. Advisers are now used to obtaining client valuations and remunerations statements electronically, rather than phoning, faxing or writing to providers. There are gaps but these are closing all the time. Standards organisations, such as Origo (which maintains the message standards used between adviser and provider/platform systems) and SWIFT (guardians of the ISO 20022 and ISO 15022 standards used in the securities market), are mature standards custodians and have now implemented all major business processes. So all (!) they have to do nowadays is keep up-to-date with the market, dealing with trifles like the RDR and auto-enrolment, while continuously promoting adoption of their standards.

Accelerated growth in STP
I believe we can now expect
to see accelerated growth in
fully integrated systems. This is necessary for the post-RDR world where service is everything, whether it is a full holistic advice service, self-service or somewhere in between. Every payment by an investor must be justified by the provision of a chargeable service. In order to remain competitive, advisers need to operate their services efficiently and mistake free.

An interesting move is from the new Zurich platform that reportedly provides two-way integration capabilities for adviser systems. Many platforms have, quietly, resisted providing such capabilities for fear of their brand becoming an invisible disintermediated technology layer. But platforms have been unable to provide a complete adviser front/back office solution and so this is a sensible, consumer and adviser-friendly move. Similar strategic decisions are bubbling away under the surface at other organisations.

CBoxx welcomes these moves and greatly looks forward to making the most of two-way STP integration services so that we can finally achieve nirvana (for our customers anyway). ●

Further information on CBoxx can be found at:




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