Tata Consultancy Services (TCS) has signed an agreement with Australian Securities Exchange (ASX) to provide the stock exchange operator with a next generation clearing and settlement platform.

Under the terms of the agreement, the Australian firm will deploy the India-based IT services and consulting company’s product TCS BaNCS for Market Infrastructure to facilitate the transformation.

TCS BaNCS for Market Infrastructure is designed specifically for central securities depositories (CSDs), central counterparty clearing houses (CCPs), exchanges, and central banks.

TCS BFSI products and platforms president Vivekanand Ramgopal said: “TCS BaNCS for Market Infrastructure continues to gain traction in the global market with its rich functionality and unique multi-asset class capability across the post-trade value chain.

“Combined with our fit-for-purpose approach to technology and innovation, this gives us the confidence to deliver a robust future-proof solution stack for the Australian market.”

ASX’s new platform will be on a state-of-the-art technology stack with TCS BaNCS for Market Infrastructure. It is expected to be executed in two releases.

TCS aims to offer the clearing service in the first phase while the settlement depository and sub‐register services will be delivered in the second phase.

The first release of the project will represent a cost between A$105m ($68.8m) and A$125m ($81.9m).

By leveraging TCS’ product, ASX intends to meet the licence obligations of ASX Clear and ASX Settlement and to support potential new services and innovation from ASX or other providers.

ASX managing director and CEO Helen Lofthouse said: “We had clear objectives for our selection process.

“These included meeting current and future market needs and our licence obligations, enabling a safe transition from the incumbent platform, minimising industry impacts where possible, and having the capability to provide interoperability and facilitate future innovation as driven by market demand.”

According to TCS, the staged approach will decrease overall delivery risk as well as help to manage the impact on industry stakeholders.