Learn · Mechanics
What is T+0 settlement and how it differs from T+1
T+0 settlement means your equity trade settles on the same day it is executed. India's standard cycle is T+1, with an optional same-day T+0 cycle that SEBI introduced in 2024.
In one line
T+0 settlement means shares and money change hands on the same day the trade is executed (day zero), compared with India's standard T+1 cycle where settlement completes one working day after the trade, and SEBI rolled out an optional T+0 cycle from 2024 alongside the T+1 default.
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What the settlement number means
Settlement is when ownership of the shares and the cash actually transfer, which is distinct from when you place the trade. The T stands for the trade date. T+1 means settlement finishes one working day later, so a Monday trade settles Tuesday. India moved fully to T+1 in January 2023, becoming one of the first major markets to do so, ahead of much of the world that was still on T+2.
A shorter cycle frees up capital faster and reduces the risk that sits between trade and settlement. The faster the money and shares move, the less counterparty and market risk builds up in the gap, which is the core reason regulators keep compressing the cycle.
The optional T+0 cycle
SEBI introduced an optional same-day T+0 settlement cycle from 2024, starting as a beta on a limited set of stocks and then widening the eligible list. It runs in parallel with T+1, so the same stock can settle in both cycles, and participation is optional rather than forced. Under T+0 a buyer can get shares and a seller can get funds on the trade day itself.
For most retail investors the practical impact today is small, because T+1 already settles fast and the T+0 universe is still expanding. The direction of travel is what matters. India is steadily pushing toward instant settlement, and T+0 is the bridge between today's next-day default and a future of real-time settlement.
FAQ3 reader questions · AEO-eligible
Common questions on t+0 settlement.
What is the difference between T+0 and T+1?
T+0 settles a trade on the same day it is executed, while T+1, India's default, settles one working day after the trade. T+0 is currently an optional parallel cycle on eligible stocks.
Is T+0 settlement mandatory in India?
No. T+0 is optional and runs alongside the standard T+1 cycle. Investors and stocks can use it where eligible, but T+1 remains the default settlement cycle.
When did India move to T+1 settlement?
India completed its phased move to a full T+1 settlement cycle in January 2023, becoming one of the first major markets to settle equity trades the next day across the board.
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