MCX is readying for options trading in commodities and currency derivatives. The Multi Commodity Exchange has asked four technology service providers to submit request for proposals, also known as RFPs.
Mrugank Paranjape, the Managing Director and CEO of MCX said, “We are exploring the possibility of engaging a new service provider for currency and have called for RFP.”
After the NSEL case had emerged in 2013, Financial Technologies (India) Limited or FTIL (the parent company of NSEL), was declared not “fit and proper” by FMC to operate the commodity exchange. But since Mrugank Paranjape joined in as the MD and CEO of MCX, there has been big shift in the authorities’ perception.
Paranjape said, “We have tested the technology (provided by FTIL)… to handle the high volumes… when the regulator allows trading in options and we found it absolutely safe to use.”
According to its MD, MCX is readying to start derivatives trading in currency and has asked four technology service providers to submit RFP. RFP makes sense, because it will collect written details about the capabilities of various suppliers to do a comparative study.
Paranjape added that MCX expects market regulator SEBI to allow options trading in commodities in less than a year. The Exchange is pinning its hope on a positive response from the regulating body and planning to launch derivatives trading in currency.
MCX derives support for its current technology from FTIL, its previous promoter. The NSE and BSE have shown interest in commodity trading, and buoyed by this, Paranjape is keen on launching trading in equities. He is right to say that it makes sense to play to one’s strengths and MCX’s is a master at this field.