Description
SEBI extends the deadline for Qualified Stock Brokers (QSBs) to implement necessary systems and processes for T+0 settlement cycle participation beyond November 1, 2025. New timeline to be announced later.
Summary
SEBI has further extended the timeline for Qualified Stock Brokers (QSBs) to implement mandatory systems and processes for enabling investor participation in the optional T+0 settlement cycle. The deadline, previously set for November 1, 2025, has been postponed due to challenges highlighted by QSBs in ensuring timely system readiness. Further guidance regarding the new timeline will be communicated at a later date.
Key Points
- Timeline for QSBs to implement T+0 settlement systems extended beyond November 1, 2025
- Extension granted due to challenges faced by QSBs in ensuring timely system readiness
- New deadline to be announced through further guidance at a later date
- This is the second extension (first extension moved deadline from May 1, 2025 to November 1, 2025)
- All other provisions of the December 10, 2024 SEBI circular remain unchanged
- Applies to QSBs who met minimum active client parameters as of December 31, 2024
Regulatory Changes
No new regulatory changes introduced. This circular only extends the implementation timeline for existing requirements under SEBI Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172 dated December 10, 2024, which enhanced the scope of optional T+0 rolling settlement cycle in Equity Cash Markets.
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
- Timeline for compliance extended beyond November 1, 2025 (new date to be announced)
- Qualification criteria: QSBs who met minimum number of active clients parameter as on December 31, 2024
For Market Infrastructure Institutions (MIIs):
- Take necessary steps and implement required systems
- Make necessary amendments to relevant byelaws, rules and regulations
- Notify market participants (including investors) and disseminate on their websites
Important Dates
- December 10, 2024: Original SEBI circular introducing enhanced scope of optional T+0 settlement
- December 31, 2024: Reference date for QSB qualification based on active client parameters
- May 1, 2025: Original deadline for QSB system implementation (first timeline)
- April 29, 2025: First extension circular issued
- November 1, 2025: Extended deadline (second timeline) - now further postponed
- October 30, 2025: SEBI issued further extension circular
- November 3, 2025: NSE circular date communicating the extension
- To be announced: New deadline for mandatory QSB system implementation
Impact Assessment
Market Impact:
- Delays the full rollout of T+0 settlement infrastructure across all Qualified Stock Brokers
- Provides relief to QSBs facing technical and operational challenges in system readiness
- May slow down broader market adoption of T+0 settlement cycle for retail investors
- Demonstrates regulatory flexibility in responding to industry implementation challenges
Operational Impact:
- QSBs gain additional time to develop and test systems for T+0 settlement participation
- Allows brokers to ensure robust system implementation rather than rushed deployment
- Stock exchanges, clearing corporations, and depositories must continue coordinating readiness efforts
- Timeline uncertainty may affect QSBs’ resource planning and vendor engagement
Investor Impact:
- Delays in QSBs offering T+0 settlement options to their clients
- Optional T+0 settlement continues to be available through brokers who have already implemented the systems voluntarily
Impact Justification
High importance and impact due to affecting all Qualified Stock Brokers and the implementation of T+0 settlement infrastructure, though severity is medium as it provides relief through timeline extension rather than imposing new immediate obligations.