Speed and scale

T+0 will help retail investors

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The Indian stock market is not only among the largest globally by market capitalisation but is also seen as one of the most efficient. To further improve market efficiency, the Securities and Exchange Board of India (Sebi) earlier this year introduced the beta version for T+0 (same-day) settlement on an optional basis for 25 scrips in the equity cash market. Based on the feedback and experience over the past several months, the regulator has now decided to extend the facility to the top 500 stocks. This shows, in Sebi's view, that the market infrastructure and the institutions involved are prepared to make this big transition at scale. Although reports suggest that the adoption of T+0 has been slow, it should not deter the regulator from taking steps to improve market efficiency. The adoption may be low partly because of the limited number of stocks in the new settlement cycle.