Although banks are common as fund custodians, securities companies can also play this role. As a custodian, securities companies are mainly responsible for supervising the transactions of funds, holding assets and ensuring the safe operation of funds, rather than directly handling the transfer of funds.
When a securities company acts as a custodian, it needs to abide by strict regulatory provisions to ensure that the fund assets are independent of the company's own assets, thus protecting the rights and interests of fund investors. The fund's fund transfer and settlement business is usually carried out by a special settlement bank to ensure the safety and transparency of funds.
Having multiple custodians will help to increase market competition and provide more choices. At the same time, the regulator will also conduct a strict audit on the custodian to ensure that it meets the requirements and standards of custody. This diversity and regulatory guarantee helps to ensure the security and transparency of the fund.