India initiated a pilot programme for its same-day settlement cycle in stock market transactions popularly known as T+0. 

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  • In the T+0 system shares will be transferred to the buyer’s account and funds will be deposited in the seller’s account on the same day of the trade.
  • Presently exchanges are conducting a pilot project for the T+0 settlement cycle which is optional alongside the existing T+1 settlement cycle in the cash market. 
  • The same-day settlement will initially be available for only 25 stocks and only a limited number of brokers will offer this service. 
  • Moreover, the trading session for stocks settled on the same day will be from 9:15 AM to 1:30 PM.

About Trade Settlement 

  • Settlement encompasses the exchange of funds and securities on the designated settlement date.
  • trade settlement is finalised when the purchased securities from a listed company are transferred to the buyer, and the seller receives the payment.
  • ‘T’ represents the transaction date and the settlement cycle designated as T+n specifies the number of days after the transaction date (T).
  • In the T+1 settlement cycle, trade-related settlements must be completed within 24 hours of the transaction’s completion.
  • SEBI’s proposed introduction of a shorter settlement cycle in addition to the existing T+1 cycle which would be offered as an option to market participants. 

The implementation is envisioned to occur in two phases:

Phase 1: T+0 Settlement Cycle

  • Under this phase an optional T+0 settlement cycle is proposed for trades conducted until 1:30 PM. 
  • Settlement of funds and securities would be completed on the same day by 4:30 PM.

Phase 2: Instant Settlement Cycle

  • The second phase involves an optional immediate trade-by-trade settlement for both funds and securities. 
  • Trading activities in this phase would continue until 3:30 PM.

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