Optional T+0 settlement cycle to cover top 500 scrips by market value, effective January 31: Sebi

Capital markets regulator Securities and Exchange Board of India said on Tuesday announced its decision to expand the scope of the optional T+0 settlement system in the spot market—also known as the cash segment—to cover the top 500 stocks by market capitalisation on Dalal Street. It also permitted all stock brokers to participate in the optional T+0 settlement cycle. Both changes will come into force from January 31, according to a Sebi circular dated December 10. 

The scrips will be in addition to the existing 25 scrips available for trading and settlement under the beta version of the optional settlement cycle, according to Sebi. 

"All stock brokers are allowed to participate in the optional T+0 settlement cycle," it added. 

The market watchdog also allowed them to levy differential brokerage fees for T+0 and T+1 settlement cycles.

T+0 Settlement for 25 Scrips | What is it and when was it introduced? 

In March, Sebi introduced an optional T+0 settlement cycle for 25 scrips, initially available to non-custodian clients only.

Which 500 companies will qualify to be added to the T+0 settlement system?

According to the circular, the T+0 settlement system will cover the top 500 scrips by market value, as of December 31.

The rollout will commence from the bottom 100 on the list in January, followed by the addition of the next 100 each month.

Other changes from January 31

Also with effect from January 31, in a move aimed at ensuring smooth implementation, market Infrastructure Institutions (MIIs) will be required to publish the operational guidelines and answers to frequently asked questions (FAQs) along with the lists of eligible scrips and qualified stock brokers (QSBs) covered on their websites. These guidelines will include the mechanisms for trading, clearing and settlement, and risk management. 

MIIs will also be required to provide fortnightly reports on the activities under the optional T+0 settlement cycle till further directions, Sebi added.