Optional T+0 settlement to be available for top 500 scrips: Sebi

Market regulator Sebi on Tuesday said optional T+0 settlement (settlement of trades on trade date) cycle would be made available to top 500 scrips in terms of market capitalisation (m-cap) as on December 31, 2024.

"The scrips shall be made available for trading and settlement starting with scrips at bottom 100 companies out of the aforesaid 500 companies and gradually include the next bottom 100 companies every month till top 500 companies are available for trading in optional T+0 settlement cycle," the Securities and Exchange Board of India stated in its recent circular.

"The above list of scrips shall be in addition to the existing 25 scrips available for trading and settlement under the Beta version of optional T+0 settlement cycle. All stock brokers are allowed to participate in the optional T+0 settlement cycle. Stock Brokers are permitted to charge differential brokerage for T+0 and T+1 settlement cycles, within the regulatory limit," it added.

Sebi mentioned that the step has been taken to further enhance the scope of optional T+0 settlement cycle.

For participation of qualified stock brokers, the regulator said designated QSBs -- meeting the parameter of minimum number of active clients for qualification as QSB as on December 31, 2024 -- would put in place necessary systems and processes for enabling seamless participation of investors in optional T+0 settlement cycle.

"In case of change in the list of QSBs, the exiting QSB shall continue to provide the necessary systems and process and the new QSBs shall put in place the necessary systems and processes for enabling seamless participation of investors in optional T+0 settlement cycle within 3 months from the date of updation of the list," it also said.

"The Stock Exchanges, Clearing Corporations and Depositories (collectively referred as Market Infrastructure Institutions or MIIs); and Custodians shall put in place necessary systems and processes for seamless participation of institutional investors in optional T+0 settlement cycle," Sebi further stated.

Block deal window in T+0 settlement cycle

The market watchdog stated that a mechanism for block deal window would be put in place by the exchanges under the optional T+0 settlement cycle. "The Block Deal window under the optional T+0 settlement cycle shall be available only for the morning session during 8:45 am to 9:00 am in addition to the existing Block Deal windows of 8:45 am to 9:00 am and 2:05 pm to 2:20 pm for T+1 settlement cycle. The trades in optional T+0 block window session will be settled on T+0 settlement cycle. Participation under this window shall be optional for the investors," it said.

To ensure smooth implementation, Sebi said the MIIs would publish the operational guidelines (including mechanism for trading, clearing and settlement, risk management, etc) and frequently asked questions (FAQs) along with the list of eligible scrips and list of QSBs for the optional T+0 settlement cycle and disseminate the same on their respective websites. MIIs would provide a fortnightly report on the activities under optional T+0 settlement cycle till further direction, it added.

All of these above measures would be applicable with effect from January 31, 2025.