ARTICLE · 10 NOVEMBER 2021

SEBI Introduces T+1 Rolling Settlement On An Optional Basis

Nishith Desai Associates

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The Securities and Exchange Board of India ("SEBI"), pursuant to requests received from various stakeholders, and discussions with Market Infrastructure Institutions (Stock Exchanges, Clearing Corporations...

IndiaCorporate/Commercial Law

Srishti Chhabra

Kishore Joshi

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BACKGROUND

The Securities and Exchange Board of India ("SEBI"), pursuant to requests received from various stakeholders, and discussions with Market Infrastructure Institutions (Stock Exchanges, Clearing Corporations and Depositories), issued a circular on September 7, 2021¹, to be effective from January 01, 2022, vide which it has provided flexibility to the stock exchanges to offer either T+1 or T+2 rolling settlement cycle ("Circular"). Accordingly, a stock exchange may choose to offer T+1 settlement cycle on any of the scrips, subject to fulfilment of certain prescribed conditions.

In this edition of the monthly digest, we will discuss the changes brought about by SEBI through the Circular, and the potential advantages and drawbacks of the same.

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