Why SEBI Launched T+0, How It Works, and Who It Benefits

A Simple Guide to India’s Move Toward Real-Time Settlement

 

 

Introduction: India’s Markets Are Getting Faster

In a significant move toward real-time trading efficiency, SEBI (Securities and Exchange Board of India) introduced the T+0 settlement cycle in 2024. This initiative positions India among the few global markets to adopt same-day settlement of equity trades.

But why was this change introduced?
What does it mean for you as an investor?
And how can it give you an edge?

Let’s break it down in simple terms.

 

What Is T+0 Settlement?

T+0 means that when you buy or sell stocks, the settlement—that is, the transfer of funds and securities—happens on the same day.

Previously, India followed a T+1 settlement cycle, where the transaction was executed today, but the settlement happened the next trading day.

 

Simple Comparison:

Cycle	You Sell Shares At	Funds Credited On
T+1	Monday	Tuesday
T+0	Monday (Before 1:30 PM)	Monday (By 4:30 PM)

 

Why Did SEBI Launch T+0?

The aim was to make India’s capital markets:

  More Efficient
  Globally Competitive

   Safer & Faster
  Aligned with digital payment expectations (like UPI)

 

Key Drivers Behind the Move:

• Reduce Settlement Risk: The longer the settlement cycle, the greater the counterparty risk (default by buyer/seller). T+0 minimizes this risk.
• Faster Liquidity for Investors: Quicker access to funds or shares enables timely reinvestments.
• Enable Real-Time Portfolio Adjustments: Especially useful in volatile markets.
• Global Leadership: India already pioneered T+1 globally in 2023—T+0 is the next bold step.

 

How T+0 Works – Step-by-Step

1. Place Your Trade before 1:30 PM in the T+0 settlement window.
2. Trade is executed on the exchange (NSE/BSE) as usual.
3. Settlement happens same day by 4:30 PM.
4. You receive either:
   • The shares (if you bought), or
   • The money (if you sold)
     — all within a few hours.

 

Real-Life Analogy

Imagine selling your gold jewelry at 11 AM and getting the money by 4 PM.
Now apply that to your stocks:
Sell shares of Infosys at 11:00 AM → Receive the money in your bank account by 4:30 PM.

That’s the power of T+0.
No overnight wait. No “settlement pending” anxiety.

 

Rollout Timeline & Scope

• Pilot Phase Launched: March 28, 2024 (25 select stocks)
• Full Rollout Plan:
  • Top 100 stocks by July 2025
  • Top 500 stocks by November 1, 2025
• Trading Window: Till 1:30 PM
• Settlement Finalized By: 4:30 PM same day

Note: T+0 trades happen in a separate window from regular T+1 trades.

 

Sources:

• SEBI Circular – Dec 2023
• NSE Press Release
• Reuters & Bloomberg, March–May 2024 coverage

 

Who Benefits from T+0?

HNI Investors:

• Better cash flow control for large portfolios
• Quick reallocation between asset classes
• Reduced exposure risk during volatile sessions

Women Investors:

• Aligns with goal-based investing (education, home, retirement)
• Faster liquidity = better financial flexibility
• Reduced dependency on delayed proceeds

Active Traders & Institutions:

• Improved fund turnover
• Reduced margin lock-ins
• Speed advantage in executing trades around news or events

 

⚠️ What to Keep in Mind

✅ Pros	⚠️ Points to Consider
Faster liquidity	Only selected stocks eligible
Lower settlement risk	Limited trading window (till 1:30 PM)
More efficient portfolios	T+0 not yet compulsory

 

Final Thought

India’s shift to T+0 settlement is not just a regulatory upgrade—
It’s a transformation in how quickly, securely, and confidently you can invest.

Whether you’re a seasoned HNI, a woman building long-term wealth, or a new investor taking your first steps—T+0 makes markets faster, safer, and smarter.

 

Want to explore how T+0 fits into your investment strategy?
Connect with our advisory desk at NAM Securities Ltd. for personalized insights.