SEBI through its circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/20 dated September 07, 2021, allowed for introduction of T+1 rolling settlement cycle. All stock exchanges, clearing corporations and depositories (collectively referred to as “Market Infrastructure Institutions (MIIs)”) jointly decided to shift to T+1 settlement cycle in a phased manner, which was fully implemented w.e.f. January 27, 2023. The shortened settlement cycle was introduced in order to bring cost and time efficiency, transparency in charges to investors and strengthening risk management at clearing corporations and the overall securities market ecosystem.
Pursuant to deliberations and approval of the Board, a further shortened timeline it has been decided to put in place a framework for introduction of the Beta version of T+0 settlement cycle on an optional basis in addition to the existing T+1 settlement cycle in equity cash market, for a limited set of 25 scrips and with a limited number of brokers.
The operational guidelines in this regard are introduced as under:
Eligible Investors: All investors are eligible to participate in the segment for T+0 settlement cycle, if they are able to meet the timelines, process and risk requirements as prescribed by the MIIs;
Surveillance Measures: The surveillance measures as applicable in T+1 settlement cycle shall be applicable to scrips in T+0 settlement cycle;
Trade Timings: One continuous trading session from 09:15 AM to 1:30 PM;
Price Band: The price in the T+0 segment will operate with a price band of + 100 basis points from the price in the regular T+1 market. This band will be re-calibrated after every 50 basis points movement in the underlying T+1 market;
Index calculation and settlement price computation: T+0 prices will not be considered in index calculation and settlement price computation. There shall be no separate close price for securities based on trading in T+0 segment;
and
Netting of Obligations: There shall be no netting in pay-in and pay-out obligations between T+1 and T+0 settlement cycle.
To ensure smooth implementation, SEBI has directed the MIIs to publish other operational guidelines (including mechanism for trading, clearing and settlement, risk management, etc.) and Frequently Asked Questions (FAQs)along with the list of 25 scrips for the Beta version of T+0 settlement cycle and to disseminate the same on their respective websites.
SEBI through its circular advised MIIs to a take necessary step and put in place necessary systems for implementation of the shortened timeline of T+0.
To discuss the above circular in detail, please feel free to contact devadhaantu@devadhaantu.in
