Sebi proposes implementation of T+0 settlement cycle in two phases

The shorter cycle to be optional; T+1 to remain available

The Securities and Exchange Board of India (Sebi) is contemplating the implementation of a same-day settlement cycle, known as T+0, in two phases. This is seen as a preliminary step towards instantaneous settlement. 

The shorter T+0 settlement cycle is being considered for the equity cash segment as an optional mechanism, in addition to the current T+1 (Trade plus one day) cycle.

The markets regulator has released a consultation paper outlining the T+0 settlement mechanism and seeking comments on potential challenges. Sebi has also tried to address concerns about fragmented liquidity raised by several foreign portfolio investors (FPIs) and institutional investors.