The Securities and Exchange Board of India (SEBI) will roll out the beta version of the T+0 settlement on an optional basis from March 28.
The T+0 settlement means that the funds and securities for a transaction will be settled on the day the trade was entered into.
“The Board approved the launch of a Beta version of optional T+0 settlement, for a limited set of 25 scrips, and with a limited set of brokers. In parallel, SEBI shall continue to do further stakeholder consultation, including with the users of the Beta version. The Board shall review the progress at the end of three months and six months from the date of this implementation, and decide on further course of action,” the market regulator said.
The T+0 settlement cycle will now be made available as an option alongside T+1.
It must be highlighted that the T+0 settlement system is not as common as T+1 or T+2 settlement cycles, but there are a few countries and markets that have adopted T+0 settlement.
The Moscow Exchange (MOEX) and Korea Exchange (KRX) offer T+0 settlements for certain securities in Russia and South Korea.
India has been operating at a T+1 settlement cycle. SEBI shortened the settlement cycle to T+3 from T+5 in 2002 and subsequently to T+2 in 2003. It introduced T+1 in 2021 and implemented in phases, with the final phase completed in January 2023.
Sebi also decided to give more FPIs exemption from the granular disclosures, relax the timelines for disclosure of certain material changes, and flexibility to FPIs in dealing with their securities after expiry of their registration.
It said that in case the concentrated holdings of FPIs in a listed company with no identified promoter meet certain thresholds, then they will be exempted from granular disclosures.
“The composite holdings of all such FPIs (that hold in excess of the 50 per cent concentration criteria and are not exempted) in the company with no identified promoter, is less than 3 per cent of its total equity share capital,” said Sebi.
These exemptions come in addition to the ones given last year in the standard operating procedure where certain public retail funds and FPIs registered with specific regulators are excluded from additional disclosures.