SEBI has asked stock exchanges, clearing corporations and depositories to reduce the turnaround time to settle trades in direct equity from T+2 to T+1 on voluntary basis.
With this, stock exchange platforms will now have an option to facilitate faster settlement cycle by opting for T+1 regime.
However, if they opt for T+1 settlement cycle, they will have to follow it for at least 6 months. They can go back to T+2 settlement regime only after six months and vice versa.
The market regulator has asked stock exchanges, clearing corporations and depositories to take necessary steps to put in place proper system in place to facilitate T+1 settlement cycle.
Settlement cycle which typically referred as transaction date plus one day or two day (T+1 or T+2) in Indian markets represents the time at which ownership of a security is transferred.
