New Delhi: The Securities and Exchange Board of India (SEBI) will introduce the beta framework for the T+0 settlement cycle starting March 28. This initiative involves a continuous session scheduled from 9:15 a.m. to 1:30 p.m.
T+0 settlement refers to the procedure of settling trades on the very same day ensuring that sellers receive payment for stocks immediately after the sale, in contrast to T+1 settlement where payment is received on the following day. (Also Read: Sensex Jumps 539pts, Nifty Closes Above 22,000 As US Fed Signals 3 Rate Cuts This Year)
“It has been decided to put in place a framework for the introduction of the Beta version of T+0 settlement cycle on an optional basis in addition to the existing T+1 settlement cycle in the equity cash market, for a limited set of 25 scrips and with a limited number of brokers,” According to a circular from SEBI. (Also Read: Zomato Customer Finds Cockroach In Sandwich Ordered From Zomato; Here’s How Netizens React)
Currently, the market operates on a T+1 settlement cycle. SEBI has requested market infrastructure institutions (MIIs) to establish extra operational guidelines regarding trading mechanisms, clearing and settlement processes, and risk management. Further, they will be releasing a set of Frequently Asked Questions (FAQs).
T+0 prices won't be taken into account in index calculation and determining settlement prices. Moreover, there won't be a distinct closing price for securities derived from T+0 segment trading.
Furthermore, there will be no offsetting of obligations between the T+1 and T+0 settlement cycles. This action by SEBI is intended to simplify and accelerate the settlement procedure, offering more flexibility and effectiveness for those involved in the market.
