HONG KONG’S stock exchange is set to shorten the time for an initial public offering (IPO) from pricing to listing to two days from the current five by the fourth quarter next year at the earliest, aligning its market more with other financial hubs in the world.

Through a digital platform known as “FINI,” brokers, underwriters and regulators and other involved parties will be able to monitor and coordinate work flow of the whole process through to the start of trading, according to a Hong Kong Exchanges & Clearing Ltd. (HKEX’) statement Tuesday.

The change will allow for a settlement cycle of two days, known as T+2, paring back an initial proposal of just one settlement day. The shorter cycle will likely cut income for brokerages who can earn interest on cash placed by investors during the settlement period.

The move will drive market efficiency and reinforce “Hong Kong’s position as the world’s premier IPO market,” HKEX’s chief executive officer Nicolas Aguzin said in the statement.

Hong Kong has seen HK$30.32 billion (US$3.9 billion) raised through IPOs so far this year. But the long settlement cycle has often dried up liquidity in the local money market, pushing up short-term interest rates and adding risks for the city’s currency peg with U.S. dollar.

The new platform would help to solve another local problem where retail investors have placed duplicate orders through different brokers to have a better chance of getting shares in popular IPOs, a practice that has been banned by local securities rules but has yet to be eradicated over the years.

HKEX also announced that starting Monday all companies seeking to sell shares on the bourse must do it entirely electronically. (SD-Agencies)