In a move aimed at ensuring smooth and efficient market functioning, the Securities and Exchange Board of India (SEBI) has issued a circular — HO/47/11/12(1)2025-MRD-POD3/I/72/2025, dated October 30, 2025 — granting a further extension of the timeline for Qualified Stock Brokers (QSBs) to implement the necessary systems and processes for the optional T+0 settlement cycle in the equity cash markets.
Background: Introduction of the Optional T+0 Settlement Cycle
SEBI had initially introduced the optional T+0 (same-day) settlement cycle through Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172 on December 10, 2024. This move was a landmark reform aimed at shortening the settlement period, thereby enhancing market liquidity, reducing counterparty risk, and aligning Indian markets with global best practices.
Under the original framework, the T+0 settlement was offered as an optional mechanism alongside the existing T+1 settlement cycle. SEBI had mandated that Qualified Stock Brokers (QSBs) — large, systemically important brokers meeting specific client and transaction criteria — must implement robust systems and processes to enable seamless investor participation in this faster settlement option by May 1, 2025.
First Extension and the Current Decision
However, following feedback from QSBs and other market infrastructure institutions such as stock exchanges, clearing corporations, and depositories, SEBI recognized the operational complexities and technological challenges involved in adopting the new settlement framework. Consequently, through a subsequent circular (SEBI/HO/MRD/MRD-PoD-3/P/CIR/2025/58) dated April 29, 2025, SEBI had extended the implementation deadline to November 1, 2025.
As the new deadline approached, several QSBs continued to highlight ongoing challenges related to system integration, coordination among multiple market intermediaries, and ensuring smooth transition without disrupting existing processes. After further consultations, SEBI has now decided to extend the timeline once again, providing QSBs additional time to ensure complete readiness for the optional T+0 settlement system.
The new implementation date will be communicated at a later stage after SEBI reviews the progress and preparedness of all stakeholders.
Implications and Next Steps
All provisions of the original December 10, 2024 circular remain unchanged, except for the extended timeline. Market Infrastructure Institutions (MIIs) — including stock exchanges, clearing corporations, and depositories — have been directed to:
- Take necessary steps to update their systems and operational workflows in line with the revised implementation schedule.
- Amend relevant bye-laws, rules, and regulations to incorporate these updates.
- Inform all market participants, including investors, brokers, and clearing members, about this extension and disseminate the details through their respective websites.
This measured approach underscores SEBI’s commitment to balancing innovation and stability. While the T+0 framework represents a major technological and procedural advancement — potentially making India’s settlement process among the fastest globally — SEBI’s decision reflects a pragmatic recognition of the complexities involved in transitioning to a same-day settlement environment.
Conclusion
SEBI’s latest extension demonstrates its investor-first and market-stability-driven approach. By allowing QSBs additional time to fully test and integrate the necessary systems, the regulator ensures that the eventual rollout of the T+0 settlement cycle will be seamless, secure, and beneficial for all stakeholders.
Once implemented, the optional T+0 settlement is expected to significantly enhance market efficiency, improve liquidity, and reduce settlement risk, marking another important milestone in the ongoing modernization of India’s capital markets.