Shorter settlement has benefited market: SEBI chief 

The adoption of a shorter settlement cycle has benefited the securities ecosystem, said the chief of Securities and Exchange Board of India (SEBI).

Speaking at an annual summit on corporate governance organised by the Confederation of Indian Industry, SEBI chief Madhabi Puri Buch, quoted a ratio that captured this improvement. She said that prior to the introduction of the T+1 settlement cycle, the DVP (Delivery versus payment) ratio was 0.7-0-8 per cent. After the implementation of the shorter settlement cycle, this ratio had halved to 0.3-0.4 per cent, implying that the market transactions had become far more optimal and efficient.

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T+1 was introduced in 2021 and implemented in phases. The beta version of T+0 settlement cycle has been made available on an optional basis from March 28 this year.

Buch further said that trust is a two way street and it is important for the industry and the regulator to build trust.

“The regulator is nothing but a proxy for investors. The resilience of the market today is because of the participation of retail investors,” she said.