The investment from J.P. Morgan and Societe Generale will be used to enhance the voice-based trading at financial markets
Financial technology firm Wematch has secured investment from J.P. Morgan and Societe Generale to transform traditionally voice-traded financial markets.
The undisclosed amount of funding from J.P. Morgan and Societe Generale is a step up for the two organisations, which have gone from Wematch users to investors, and the banks are already active across all existing platforms of the fintech firm.
Wematch offers technology which augments how traders at banks match, negotiate and manage trades. The technology offered by Wematch brings audit and control benefits of electronic tools to voice trading, delivered via web-based software-as-a-service technology.
The firm’s technology is used by multiple institutions and traders who match and negotiate interest rates derivatives, equity derivatives and securities financing structures, worth billions of dollars.
At present, there are 40 banks and more than 750 traders on Wematch cross assets and more traders and banks are expected to use the technology.
Wematch offers the benefits of the latest web technologies for traders at banks in improving the matching and negotiation process, cutting costs for banks and increasing efficiency and reducing conduct risk for traders.
Wematch co-CEO Gregory Mimoun said: “Wematch is delivering the next generation in trading protocols, with intuitive GUIs and workflow tools to give voice trading professionals the edge. Everything we build is designed to support the trader’s decision, giving them the tools to make the right call with confidence and certainty.”
The fintech firm is touted to have enormous potential to support the capital market industry in adopting digital solutions across multiple markets globally and to adapt the technology for internal and client-facing solutions.
More than 80% of derivatives trade is estimated to be conducted by voice
Even with pressure from regulators for more trades to be conducted on electronic trading venues, it is estimated that more than 80% of the structured products and FX derivatives are transacted by voice.
As per the Bank for International Settlements, the interest rate swaps market which is worth $2.1 trillion a day has more than 70% of the business being handled by phone negotiation.
J.P. Morgan markets lab head Pasquale Cataldi said: “J.P. Morgan was an early supporter of WeMatch. As a member of our In Residence Programme, the platform showed real potential to transform the interbank interest rate dealing market through automation, resulting in audit and control benefits.
“The level of market adoption has already been encouraging and we’re delighted to continue the journey with them.”
Societe Generale global markets sales deputy head Albert Loo said: “Societe Generale is excited to contribute to the Wematch development after a successful collaboration within our Global Markets Incubator.
“Innovation in trading technology will drive efficiencies for market participants and we strongly believe that Wematch can sustainably improve dealing processes across asset classes.”