63 Moons will not maintain MCX systems

Mumbai: 63 Moons Technologies (formerly Financial Technologies) on Monday informed stock exchanges that the software support it provides to MCX, the largest commodities bourse in India, will be stopped from October 1 after its 10-year maintenance contract ends on September 30. Since the source code of the software is with 63 Moons and MCX is yet to have a new software in place, this could potentially push the commodities derivatives trading on the bourse into a high-risk territory, market players and industry sources said.

Last week, MCX had said that although they had given a contract to TCS to develop a trading system which would replace the existing one, the same has been delayed due to the complexities of the system.

Since the software maintenance agreement is not renewed, 63 Moons said, “MCX’s right to continue to use the Exchange Technology software (with no access to source code to rectify issues or bugs that may arise) shall be subject to any regulatory restriction the regulator may impose on MCX. MCX shall not be entitled to receive any support on the Exchange Technology software after September 30, if the trading or settlement system halts for any reason. No work around by any person is possible in issues arising in the exchange platform as no access to source code is available to MCX.”Earlier, MCX had said, “In the absence of continuity of services by 63 Moons, the existing system will continue to be operated by the existing in-house IT team, which has been augmented by necessary expertise. No code changes and enhancements are envisaged under this option.”

According to sources, since the start of the contract, a team of IT professionals from 63 Moons has been on standby for supporting MCX’s systems on a 24x7 basis. The 63 Moons team took care of any bugs and other issues that the system faced while running the trading engine. It also supported other critical exchange functions like risk management, surveillance, clearing & settlement, banking gateway and other connectivity issues.

MCX said in the last three years its system did not face any major issue with its systems. However, a source explained that was because the 63 Moons team took care of smaller and minor issues on time so that those did not grow to be a major issue.

According to a trader, on stock exchanges a major software glitch could be rectified by stopping the system. However, in case of commodities trading, any stoppage could lead to some major losses for traders since prices of most of the commodities traded in India are marked to international prices, which are changing continuously.