A trade settlement occurs when the buyer receives the security and the seller is paid. Regulators hope a faster settlement process will reduce risk and improve efficiency in the world’s largest markets, as investors will get their money and securities sooner. Now India has set its sights on same-day settlement, joining China where stock settlement is T+0 and T+1 for cash settlement. As market participants adjust to faster settlements, they expect a temporary increase in trade fails. This happened in September 2017 when the settlement period was reduced from three to two days, according to Sifma.

Source: Indian Express May 28, 2024 19:45 UTC