DTCC releases T+1 testing framework

The Depository Trust & Clearing Corporation (DTCC) released a testing framework and timeline for the US industry move to T+1 settlement cycle. The financial services industry, in coordination with regulators, is planning to shorten the standard settlement cycle for equities, corporate bonds, municipal bonds, unit investment trusts, and financial instruments comprised of these security types (ADRs and ETFs for example), from the current trade date plus two business days (T+2) to trade date plus one business day (T+1) on a date in 2024 yet to be determined. In the paper, DTCC referenced September 3, 2024, as the transition date until further notice.

The move to a T+1 settlement cycle has broad industry and regulatory support and has been an ongoing industry effort for well over two years. The move to T+1 will generate significant risk reductions for all market participants and will require organizations across the financial services industry to assess and potentially modify aspects of their trade processing lifecycle.

The number of changes being made to support the move to T+1 – and the magnitude of the firms making the changes – results in the need for a comprehensive and well-coordinated industry test to confirm industry readiness and ensure a successful industry implementation.

The purpose of this paper is to provide DTCC Members with a detailed plan for testing T+1 changes with DTCC and other industry infrastructures. The paper includes detailed information on:

  • The structure of the T+1 industry test, including information on other industry infrastructures participating in the industry test, testing cycles and testing schedules.
  • DTCC’s T+1 and T+2 test environments, including information on the role of the different environments, how to connect to the different environments and how to get all the required access in both environments to support testing.
  • Suggested test scenarios which Members can use to begin preparing their own T+1 test plans.

Read the full paper

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