Description

SEBI extends the timeline beyond November 01, 2025 for Qualified Stock Brokers to implement necessary systems and processes for enabling investor participation in optional T+0 settlement cycle.

Summary

SEBI has issued a further extension of the timeline for Qualified Stock Brokers (QSBs) to implement mandatory systems and processes for enabling seamless investor participation in the optional T+0 settlement cycle. The original deadline of May 01, 2025 was previously extended to November 01, 2025, and has now been extended again with further guidance to be provided at a later date. This decision considers the challenges highlighted by QSBs in ensuring timely readiness of their systems.

Key Points

  • The mandatory implementation deadline for QSBs previously extended to November 01, 2025 is now further extended
  • New timeline will be intimated at a later date based on QSB readiness
  • QSBs must implement systems for enabling seamless investor participation in optional T+0 settlement cycle
  • The extension applies to QSBs designated as such and meeting minimum active client parameters as on December 31, 2024
  • All other provisions of the original SEBI Circular dated December 10, 2024 remain unchanged
  • Market Infrastructure Institutions (MIIs) must implement necessary systems and amendments

Regulatory Changes

This circular modifies the implementation timeline specified in:

  • SEBI Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172 dated December 10, 2024 (original circular introducing optional T+0 settlement)
  • SEBI Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2025/58 dated April 29, 2025 (first extension to November 01, 2025)

The extension acknowledges operational challenges faced by QSBs in achieving system readiness within the previously stipulated timeframe.

Compliance Requirements

For Qualified Stock Brokers (QSBs):

  • Must eventually implement necessary systems and processes for enabling seamless investor participation in optional T+0 settlement cycle
  • Applies to brokers designated as QSBs meeting minimum active client parameters as on December 31, 2024
  • Timeline for compliance to be announced at a later date

For Market Infrastructure Institutions (MIIs):

  • Take necessary steps and implement required systems
  • Make necessary amendments to byelaws, rules and regulations for implementation
  • Bring provisions to notice of market participants including investors
  • Disseminate information on their websites

Important Dates

  • December 10, 2024: Original SEBI circular introducing optional T+0 settlement
  • December 31, 2024: Reference date for QSB designation and minimum active client parameters
  • May 01, 2025: Original implementation deadline (first timeline)
  • 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 QSBs

Impact Assessment

Market Operations: The further extension delays the full-scale rollout of mandatory T+0 settlement infrastructure by QSBs but ensures more robust implementation when launched. Optional T+0 settlement remains available, but universal broker participation is postponed.

Stock Brokers: Provides additional time for QSBs to develop and test systems, reducing implementation risks. Smaller brokers benefit from extended preparation period to meet technical and operational requirements.

Investors: Delays universal access to T+0 settlement benefits through all QSBs, but ensures better system reliability when implemented. Investors can still access T+0 settlement through brokers who have voluntarily implemented the system.

Technology Vendors: Extended timeline allows vendors more time to deliver compliant solutions to broker clients facing technical challenges.

Regulatory Framework: Demonstrates regulatory flexibility in response to industry feedback while maintaining commitment to eventual T+0 settlement adoption.

Impact Justification

Timeline extension provides operational flexibility to QSBs but delays full T+0 settlement implementation. Affects stock brokers and their readiness for optional T+0 settlement cycle in equity cash markets.