SEBI to Expand T+0 Settlement: Strengthening India’s Financial Market Infrastructure
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The Securities and Exchange Board of India (SEBI) is expanding the T+0 settlement cycle to more stocks, enabling same-day transfer of shares and funds. This move enhances market efficiency, reduces settlement risks, and cements India's position as a global leader in capital market technology.
The Securities and Exchange Board of India (SEBI) has announced plans to expand the T+0 settlement cycle to a wider array of stocks following the successful completion of its initial pilot phase. T+0 settlement refers to a system where the transfer of shares and funds happens on the same day the trade is executed, a significant leap from the current T+1 (trade plus one day) standard.
India has been a pioneer in shortening settlement cycles, having transitioned from T+2 to T+1 in early 2023. The move toward T+0 is designed to provide investors with immediate access to liquidity, thereby increasing the velocity of capital in the market. By shortening the time between trade execution and settlement, the regulator aims to significantly reduce counterparty and settlement risks, which are inherent in longer cycles. This modernization is expected to make the Indian equity market more attractive to retail investors who value quick access to their funds.
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