UK and EU financial services must ensure compliance readiness for the T+1 settlement by 11 October 2027.
T+1 settlement means trades will settle one business day after the trade date, a move intended to lower the chance of settlement failures and boost market efficiency.
“Speeding up the settlement of trades makes our financial markets more efficient and internationally competitive”, said Rachel Reeves, the UK Chancellor.
In preparation for the T+1 cycle deadline, which replaces T+2, organisations need to implement changes to their current processes, upgrade systems, automate workflows, and test for readiness.
Non-compliance, which threatens market integrity, could lead to regulatory action.
Under T+1, the entire post-trade workflow must operate nearly in real-time and liquidity management, FX (Foreign Exchange) execution, data accuracy, automation, and counterparty coordination must work together to achieve settlement success through collaboration, technology investment and good data governance.
From predicting future changes, flagging gaps in processes, understanding impact and ensuring smoother implementation, regulatory compliance solutions such as FinregE provide the capabilities, insight and governance for firms to comply fast.
What is the T+1 settlement?
T+1 settlement simply means that if you buy a stock or bond, it will be confirmed, funded and settled in one business day, shortening the procedure that usually takes 48 hours (T+2).
Following in the footsteps of the US, Mexico, Canada, countries that implemented T+1 in 2024 and have measured tangible benefits such as lower counterparty risk, smaller margin requirements, and better liquidity, the UK and the EU are also moving to implement T+1 on 11 October 2027 to align with global markets.
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What this shift means for UK capital markets
According to the Financial Conduct Authority (FCA), T+1 will “reduce the time available for settlement processing by around 80%.”
The shift to T+1 is essential to the UK’s Financial Services Growth and Competitiveness Strategy, which aims to strengthen London’s position as a global financial hub.
Despite the benefits of T+1, implementation will be difficult for many. Firms will need to perform real-time trade matching, instant FX booking, and accurate fund allocation to meet new deadlines.
Unfortunately, UK traders that have made similar preparations for the US T+1 move will need to start from scratch because the UK market operates with multiple central counterparties (CCPs), central securities depositories (CSDs), and currencies.
Global momentum: A worldwide shift to T+1
T+1 is becoming a global standard, which helps to eradicate fragmentation across settlement cycles.
Here’s what’s happening globally:
- The US, Canada, and Mexico have completed their transition in 2024, releasing billions of dollars in liquidity and lowering the need for clearing funds by as much as 23%.
- In close collaboration with the UK and Switzerland, the European Securities and Markets Authority (ESMA) is planning for an EU-wide transition under the CSDR Refit by 2027.
- China is already operating at T+0, indicating the possibility of instant settlement in the future, while India has gradually implemented T+1.
- Switzerland and Australia are in the consultation stages to comply with the 2027 schedule.
Businesses operating in numerous jurisdictions will need to harmonise their data, match workflows, and compliance policies across T+1 and T+2 marketplaces until T+1 becomes a global standard.
5 ways to prepare for T+1 settlement
The deadline is fast approaching, and firms must demonstrate their readiness through market-wide testing by December 2026. The FCA will be monitoring firm readiness and expects alignment with AST recommendations.
Here are key priorities to watch out for:
- Begin budgeting and planning by establishing a dedicated T+1 project team. Assess current internal policies and system capabilities.
- Increase automation in trade matching, confirmation, and settlement instructions. T+1 timelines cannot be met by manual processes.
- Improve data governance to guarantee the accuracy of counterparties, SSIs, and static data across systems.
- Strengthen FX and liquidity management, especially for cross-border transactions.
- Make sure all parties, including clients and custodians, agree on communication methods, data standards, and scheduling.
- To track development and reduce risk, create strong governance frameworks that incorporate operational teams, technology, and compliance.
How FinregE enables T+1 readiness
Switching to T+1 requires more than just compliance; it requires capacity. FinregE uses automation, intelligence, and control to help businesses develop that capability.
- Real-time horizon scanning
FinregE provides real-time updates from over 1,900 regulatory sources. It also provides summaries of changes from the FCA, Bank of England, HM Treasury, ESMA, and international organisations.
FinregE ensures businesses are immediately informed of new T+1 regulations, guidelines, and deadlines so they may take proactive measures.
- Intelligent impact analysis
FinregE directly links T+1 obligations to internal policies, processes, and systems through its regulatory change impact assessment workflow
Businesses may allocate ownership, tasks, and deadlines in an organised, auditable manner and quickly determine where adjustments are required.
- AI-powered interpretation
FinregE’s AI Regulatory Insights Generator (RIG) uses ML/NLP to interpret complex regulatory publications, such as the UK T+1 Code of Conduct and AST guidance and convert them into useful insights.
This allows clarity across the organisation by allowing compliance and operations teams to reduce analysis time from days to hours.
- Digital rulebooks and regulatory mapping
Using Digital Rulebooks and RIGMAPS, FinregE maps every new T+1 regulatory requirement to your existing control framework.
It automatically identifies gaps, recommends corrective actions, and monitors completion.
- Interactive dashboards
FinregE’s interactive dashboards help the firm to visualise its T+1 readiness across functions, deadlines, and counterparties.
In just a few minutes, companies can create reports that are ready for regulators, ensuring accountability and transparency at every stage of the process.
By combining automation and regulatory intelligence in a single platform, FinregE ensures a seamless transition to T+1. This prepares the firms for the next T+0 era.
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