The Indian national regulator allowed from January 1 last year the NSE and the other Indian market the Bombay Stock Exchange to settle their trades on T+1 or T+2, writes Global Investor. All large-cap and blue-chip companies will switch to the T+1 system on January 27, writes mint.
Euroclear’s Taskize wrote in an emailed statement: “India’s full transition to T+1 settlement is the first step in homogenising settlement cycles around the world. However, unlike the global nature of the US markets, most of the trading in India is domestic. In contrast, US securities globally trade and settle across US, Europe and Asia. As a result, increased complexity due to timezone differences must be considered.
“The common tactical approach of ‘throwing more bodies’ at the problem is no longer viable when physical distance makes the logical clock tick faster. This must be the year everyone has to prepare for the US move to T+1 so solutions that are available today that can be deployed quickly with minimal risk can help release the time pressure on settlement processing.”