iSignthis Ltd and NSX Limited are both pleased to announce that they have entered into a Shareholders Agreement to form a joint venture vehicle, ClearPay Pty Ltd (“ClearPay JV”), to develop a multicurrency, real-time, same day DvP platform (“ClearPay”), to be integrated with ISX’s ISXPay® and PaydentityTM.
The system will initially be utilized alongside with the National Stock Exchange of Australia’s (“NSXA”) current post-trade arrangements where appropriate. However, the NSXA, NSX’s wholly
owned subsidiary market operator, intends to ultimately process all transactions via the new platform.
With ClearPay, the NSXA will be able to offer a same-day settlement (T+0) capability which will supersede the current (T+ various days delayed for the clearing and settlement) process offered by other domestic and global exchanges.
Settlement by other exchanges is usually T+2 or T+3 days. On completion of ClearPay’s DvP platform, it is expected that the domestic and international broker network will expand and connect via industry-standard ISO20022 interface and participate using an industry-standard blockchain. This will provide the NSXA with one of the world’s most advanced DvP platforms, inclusive of an inbuilt sub-registry.
Under the terms of the ClearPay Shareholders Agreement, the first cash call for ClearPay JV post the first NSX placement will be a sum of $3.2 million for a 41% interest by the NSX. ISX will be contributing intellectual property and its subsidiary, Probanx Solutions Ltd, will design and develop the DvP platform for a fee, including the integration into ISXPay® and PaydentityTM platforms.
The second cash call will be a sum of $1.3 million contributed by NSX for a further 9% interest in ClearPay, should NSX raise at least that minimum amount under terms of a proposed further placement, being $3.8 million. NSX and ISX would at that stage equally own 50% of ClearPay JV.
“It’s very exciting for us that the ClearPay JV will bring genuine competition to the Australian cash equities eco-system. iSignthis brings an inherent high technology capability to the NSXA, including its extensive payments and Know Your Customer’s Customer (“KYCC”) services, ISXPay® and PaydentityTM” said ISX Managing Director and CEO John Karantzis.
NSX and ISX || ClearPay JV 20th February 2020 Page 2 of 3 Mr. Karantzis will act as the CEO of ClearPay during the software development stage, with the NSXA operating the platform once full technical and business development has been achieved.
Thomas Price, acting CEO of NSX comments: “Market commentators are in broad agreement that cash equity exchanges are facing a global technology revolution which is challenging legacy methods of clearing and settlement. Having patiently monitored the development of the appropriate technology and know how we consider that this is the right time for the NSX to act.”
“The ClearPay joint venture with iSignthis allows the NSX to expedite its plans to transform its licenced exchange market within a cost-efficient framework. The introduction of an already experienced provider of RegTech and payments systems is very satisfying for us as it allows an accelerated build process.”
“More exciting is that it creates a solid foundation for the NSXA to be a true independent first-class venue of choice for companies seeking to be serviced via the most advanced infrastructure and distribution in their goal of attracting investors from both here and abroad.“