Icap to broke e-forwards

Icap is currently testing the system in-house, and expects to start using it in about three months. McLumpha said the platform is based on the firm's existing technology, although he would not confirm any further details about its design.

The service will only include short-dated foreign exchange contracts initially, and will cover the seven major currencies, but Icap may extend this to long-dated contracts if there is sufficient demand, said McLumpha.

One source at a rival broking house in London said this was a typical first step towards launching a full system for clients. "It's a common process to develop an order capture system and take it to a fully transactional system," he said. "It's likely this is stage one, so they're testing the order capture to see how it works on screens and to check its robustness, then they can just bolt on the fully transactional bit later."

If it does decide to launch a service for its clients, Icap faces an already crowded market, with trading technology firms Bloomberg and Reuters, and brokerage house Tullett & Tokyo Liberty all now offering electronic broking services for forwards foreign exchange contracts.