SEBI will beta test T+0 settlement from March 28. A five-step guide for investors

The Securities and Exchange Board of India will run the beta framework for the T+0 settlement cycle from March 28. A continuous session, it will be launched between 9:15 a.m. and 1:30 p.m.

T+0 settlement is the process of settling trades on the same day, which means that the seller of stocks will receive money on the day of sale, unlike T+1.

Sebi on March 15 had okayed the beta launch for 25 scrips, with a limited set of brokers. The price in T+0 will operate with a band of (+/-) 100 bps from T+1 prices. 

"The band will be recalibrated after every 50 bps movement in the underlying T+1 market," a Sebi circular said, adding that it will not be used to measure index and settlement price computation. The closing price for securities trading in T+0 settlement will be the same as T+0 settlement.

1.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.

2. Surveillance Measures: The surveillance measures as applicable in T+1 settlement cycle shall be applicable to scrips in T+0 settlement cycle.

3.Trade Timings: One continuous trading session from 09:15 AM to 1:30 PM.

4.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.

5.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.

6.Netting of Obligations: There shall be no netting in pay-in and pay-out obligations between T+1 and T+0 settlement cycle.