card-img

SEBI aims to settle shares within an hour

2 mins read . 07 Sep 2023

  • 2 people read

In a landmark announcement for the Indian stock market, SEBI Chairperson Madhabi Puri Buch unveiled a ground breaking shift in trade settlement policy at the Global Fintech Summit in Mumbai on Tuesday. This development positions India at the forefront of financial markets worldwide.

The idea is that by March 2024, SEBI aims to introduce a one-hour trade settlement cycle, replacing the current T+1 system. This bold step makes India the first jurisdiction globally to transition to T+1 settlement, a crucial step toward achieving instantaneous settlements.

SEBI's history shows a willingness to shorten settlement cycles, reducing from T+5 days to T+3 days in 2002, and then to T+2 days in 2003. Each adjustment brought the market closer to real-time settlements.

SEBI's roadmap toward instantaneous settlements reveals an ambitious commitment to embracing technology. Transitioning from a one-day to a one-hour cycle, and ultimately to instantaneous settlements, demonstrates SEBI's dedication to innovation.

The move promises to expedite fund flows, eliminating an extra day of waiting and offering greater flexibility for traders and investors.

SEBI's vision extends beyond settlement cycles. The Chairperson hinted at plans to provide clients direct bourse access in case of broker server crashes, reducing risks and enabling efficient position management.

Moreover, an Application Supported By Blocked Amount (ASBA)-like facility for the secondary market may arrive by January 2024. ASBA, successful in IPO applications, allows funds to earn interest while temporarily blocked, potentially lowering margin requirements for clients and enhancing retail investment prospects.

current-img
Related Blogs
blog-logo

Mutual Fund

img

6 mins read . 13 Nov 2023

Avoid the pitfalls: why buying low NAV funds is not a strategy

Read more east
  • 184 people read
blog-logo

Demat Account

img

9 mins read . 10 Nov 2023

Muhurat Trading 2023: A Guide to Auspicious Stock Market Beginnings

Read more east
  • 0 people read
blog-logo

Mutual Fund

img

13 mins read . 06 Nov 2023

Debt and Hybrid Funds performance for October 2023

Read more east
  • 0 people read
blog-logo

Share Market

img

11 mins read . 03 Nov 2023

Top performing Equity Funds in October 2023

Read more east
  • 0 people read
Kickstart your equities journey today You've got this
By submitting this I agree to the terms & conditions