Korea Securities Depository said on August 7 that it has begun building a dedicated clearing and settlement platform for over-the-counter transactions in unlisted shares and fractional investments. The new infrastructure is scheduled for completion by the end of the year.
The depository said the system will be based on electronic securities and designed to support settlement across brokerages, addressing a key limitation in the current sandbox framework while also preparing for possible future products such as security tokens.
Standalone system with faster settlement
According to Korea Securities Depository, the platform will use a T+1 settlement cycle, meaning transactions are settled one business day after trading. The depository said this is one day faster than the existing securities market.
The new service is being developed as a separate module rather than being folded into the current clearing and settlement systems used for the stock market and K-OTC. The standalone design is intended to create room for additional product types in the future, including security tokens, or STs.
Cross-broker settlement is the main change
A central feature of the planned platform is the ability to settle trades through the depository even when the buyer and seller hold linked accounts at different securities firms. Once the system is in place, securities companies would be able to complete settlement through the central infrastructure instead of being limited by the broker used on each side of a transaction.
That marks a shift from the current sandbox arrangement, where trading is only possible between accounts held at the same securities firm. Korea Securities Depository said removing that restriction should make trading more convenient and could help improve liquidity in the market for these products.
Four OTC operators included in the rollout
The infrastructure is set to cover four over-the-counter operators. In the unlisted shares segment, the depository named Naver Pay Unlisted and Seoul Exchange Unlisted.
For fractional investment, the platform will include the KDX Consortium and the NXT Consortium, also known as Nextrade. The planned scope indicates that the system is meant to serve multiple OTC venues rather than a single operator.
Testing planned before year-end completion
Korea Securities Depository said it plans to run mock-market tests in October and November. Those tests are expected to come ahead of the final buildout and launch process.
The current target is to complete the infrastructure in December. If that timeline is met, the next confirmed step before full completion will be the scheduled testing phase in the fourth quarter.
Source: en.bloomingbit.io