Angel One develops post-trade reporting platform on AWS
Modernizing outdated financial systems to comply with regulations is a complex task that requires careful planning and the use of efficient cloud solutions. Angel One exemplifies this process with their transformation of a fragile back office system driven by stored procedures into a cloud-native, auditable system on AWS. This article delves into the architecture, challenges, and outcomes of Angel One’s journey in building a post-trade reporting platform capable of handling 30 million records daily while meeting SEBI’s stringent compliance standards for client-level collateral segregation.
Angel One, a renowned retail full-service broker in India trusted by millions of clients, undertook this transformation to adhere to SEBI’s enhanced regulatory reporting and monitoring requirements. By abandoning their outdated setup, Angel One not only met the regulatory demands but also showcased how AWS analytics services can revamp crucial financial infrastructure while ensuring compliance.
One of the primary challenges faced by Angel One was related to their legacy database. The existing system relied on an MSSQL database that had evolved over time, resulting in a convoluted web of T-SQL stored procedures that were hard to decipher. Additionally, the system depended on a delicate scheduling mechanism driven by SQL agent timers, which, if disrupted, caused a series of failures in subsequent processes, especially during crucial overnight processing windows. Such fragility often led to weekend war rooms and manual interventions to maintain operations, reflecting the urgency for modernization.
Moreover, compliance-related challenges further pressed Angel One towards transformation. The introduction of SEBI’s mandates, requiring meticulous client-level collateral segregation and daily reporting, exposed the limitations of the MSSQL-based system. Handling delayed data feeds and maintaining data lineage became cumbersome tasks due to limited replay capabilities, leading to manual edits and extensive troubleshooting sessions. The system’s inability to scale efficiently with growing transaction volumes exacerbated these challenges, prompting Angel One to undergo a comprehensive modernization effort.
The revamped back-office system needed to cater to SEBI’s regulatory mandate, emphasizing daily client-level collateral reporting and asset segregation. This regulatory change aimed to enhance market transparency and protection by ensuring clear separation of clients’ assets from brokers’ funds. To achieve this, brokers were required to maintain detailed records of collateral usage for each client, ranging from cash holdings to securities like mutual funds and shares, and their allocation across various trading activities.
The complexity of these requirements is best illustrated through practical scenarios. Clients’ cash and securities collateral had to be meticulously managed to comply with clearing corporation rules, where a certain cash portion must be maintained. The platform needed to accurately allocate cash and securities, even utilizing broker funds temporarily when required, while maintaining complete auditability throughout the process. This intensified set of requirements tested the boundaries of traditional reporting systems.
Angel One’s solution involved transitioning to a cloud-native architecture using AWS serverless components, shifting from a monolithic to a flexible, scalable system. This move facilitated real-time processing, granular tracking, and comprehensive auditability, aligning with SEBI’s regulations and ensuring historical accuracy for future reference. By embracing modern cloud solutions, Angel One successfully overcame the challenges posed by legacy systems and regulatory requirements, setting a precedent for other financial institutions looking to revamp their operations seamlessly.