Description

SEBI extends the deadline for Qualified Stock Brokers to implement necessary systems and processes for enabling investor participation in optional T+0 settlement cycle, with new timeline to be announced later.

Summary

SEBI has further extended the timeline for Qualified Stock Brokers (QSBs) to implement necessary systems and processes for enabling seamless investor participation in the optional T+0 settlement cycle. The previous deadline of November 01, 2025 has been postponed indefinitely, with further guidance to be provided at a later date. This extension follows challenges highlighted by QSBs regarding timely system readiness.

Key Points

  • Timeline for QSBs to implement T+0 settlement systems extended beyond November 01, 2025
  • New deadline to be communicated at a later date
  • Extension applies to QSBs designated as such and meeting minimum active client parameters as of December 31, 2024
  • This is the second extension after the initial May 01, 2025 deadline was moved to November 01, 2025
  • All other provisions of SEBI Circular dated December 10, 2024 remain unchanged
  • Decision based on challenges highlighted by QSBs in ensuring timely system readiness

Regulatory Changes

Original Framework (December 10, 2024):

  • SEBI Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172 enhanced scope of optional T+0 rolling settlement cycle in addition to existing T+1 settlement cycle in Equity Cash Markets
  • QSBs meeting minimum active client parameters as of December 31, 2024 required to put in place necessary systems

First Extension (April 29, 2025):

  • SEBI Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2025/58 extended implementation deadline from May 01, 2025 to November 01, 2025

Current Extension (October 30, 2025):

  • Timeline extended beyond November 01, 2025 with new date to be announced
  • Extension based on feedback from QSBs, discussions with Stock Exchanges, Clearing Corporations, and Depositories

Compliance Requirements

For Qualified Stock Brokers (QSBs):

  • Must eventually put in place necessary systems and processes for enabling seamless participation of investors in optional T+0 settlement cycle
  • Applies to brokers designated as QSBs who met minimum active client parameters as of December 31, 2024
  • Immediate pressure for November 01, 2025 readiness removed
  • Must await further guidance on new implementation timeline

For Market Infrastructure Institutions (MIIs):

  • Take necessary steps and put in place systems for implementation
  • Make necessary amendments to relevant byelaws, rules, and regulations wherever required
  • Bring provisions to notice of market participants including investors
  • Disseminate circular on their website

Important Dates

  • December 10, 2024: Original SEBI circular issued enhancing scope of optional T+0 settlement
  • December 31, 2024: Reference date for QSB designation and minimum active client parameters
  • May 01, 2025: Original implementation deadline (later extended)
  • April 29, 2025: First extension circular issued
  • November 01, 2025: Previous extended deadline (now further extended)
  • October 30, 2025: Current circular issued
  • To Be Announced: New implementation deadline for QSB system readiness

Impact Assessment

Market Infrastructure Impact:

  • Delays rollout of optional T+0 settlement infrastructure for retail investors
  • Provides additional time for QSBs to develop and test systems without rushed implementation
  • Indicates significant technical and operational challenges in implementing T+0 settlement at broker level

Broker Impact:

  • Relieves immediate implementation pressure on Qualified Stock Brokers
  • Allows more time for system development, testing, and integration
  • Reflects industry-wide concerns about readiness for T+0 settlement operations

Investor Impact:

  • Delays availability of optional T+0 settlement for seamless participation
  • Ensures more robust implementation when finally rolled out
  • Maintains status quo of T+1 settlement cycle as primary mechanism

Regulatory Impact:

  • Demonstrates regulatory flexibility in response to industry feedback
  • Uncertainty around new timeline may affect planning for market participants
  • Two extensions suggest more complex implementation challenges than initially anticipated

Impact Justification

This circular significantly impacts the implementation timeline of T+0 settlement for Qualified Stock Brokers, affecting market infrastructure readiness and investor participation in the optional T+0 settlement cycle. The indefinite extension indicates systemic challenges requiring resolution.