CDC reduces its tariff to facilitate ease of doing business
As the infrastructure backbone of Pakistan Capital Market, CDC’s main objective is to provide efficient and cost effective services to all its customers and promote ease of doing business. In line with this resolve, CDC has continued to pass on the benefits to market participants and general investors without compromising on its services. It has once again reduced its tariff structure in the larger interest of the public and in the support of the stock market.
Central Depository Company has reduced its service tariff for the Mutual Fund Industry up to 57%, applicable to different categories of funds. Apart from the said reduction, CDC has also rationalized the trustee fee for small sized mutual funds / schemes by permanently eliminating the minimum fee component and implementing flat rate instead of slab system. This reduction will be effective from July 01, 2019 and is expected to facilitate Asset Management Companies in making their funds / schemes more investment-worthy in the current challenging times.
This is not the first time CDC has reduced its service tariff. In fact, in the past, the tariffs for depository services (both custody and transaction fee) and trustee services have been reduced a number of times. The current reduction compliments a number of CDC’s earlier contributions in the development of the Mutual Fund Industry including its state-of-the-art Fund Management System which has enabled the industry to implement Straight Through Processing (STP) from AMCs to Banks and also helps ensure compliance with relevant regulatory framework.
As part of the recent reduction, CDC has provided 100% waiver on Maintenance fee for such Sub-Account holders who also have Investor Accounts. Taking this initiative further in order to promote the growth of Pakistan’s corporate debt market, CDC has significantly reduced its annual fee for long-term redeemable securities by approximately 65%. Additionally, CDC has rationalized its tariff structure for next five years which also includes reduction in custody fee for the years 2019-20 and 2020-21 by 14% and 16% respectively.