Trade-plus-One (T+1) Settlement Cycle

On 27^th January, 2023, India become the second country in the world after China, to start the ‘trade-plus-one’ (T+1) settlement cycle in top listed securities.

• The phased transition had begun on February 25, 2022, following markets regulator Securities and Exchange Board of India (SEBI)’s circular in September 2021.

About Trade-plus-one’ (T+1) Settlement Cycle: The T+1 settlement cycle means that trade-related settlements must be done within a day, or 24 hours, of the completion of a transaction.(T stands for the trading day).

• For example, under T+1, if a customer bought shares on Wednesday, they would be credited to the customer’s demat account on Thursday. This is different from T+2, where they will be settled on Friday.

Impact: Seamless Transactions; Operational Efficiency; Faster Fund Remittances; and Reducing Risks.