Investors will get faster settlement and they will have faster cash in hand with SEBI's plan of one-hour trade settlement, said A Balakrishnan, Executive Director of Geojit Financial Services. "We do not see any impediment in Sebi's plan to implement a one-hour settlement of trades first. It is highly implementable when Clearing Corporations and Depositories are ready with the systems. UPI's success created confidence in near real-time settlement," he said.
"Investors will get faster settlement, and they will have faster cash in hand. It is like having a UPI where transactions are settled quickly. It will mark a significant leap in transparency and efficiency in the Indian stock market, offering investors real-time access to their assets, which will further attract resident investors in our stock market," he added.
Rishi Agrawal, CEO and Co-Founder of Teamlease RegTech said the change is great news for investors. In the T+1 settlement cycle, liquidity becomes available in a couple of days. With the hourly settlement, this cycle will be further crunched, making capital market investments even more attractive. In addition, the change will also free up a significant chunk of margin money that brokers maintain with the clearing corporation. However, the regulatory reporting obligations of the key market participants, such as brokers, clearing corporations, depository institutions, and fund houses, will be affected. They must modify their technology systems from an end-of-day batch processing mode to hourly processing, he said.