As of 11 October, markets in the United Kingdom, European Union, Switzerland and Liechtenstein have entered a two-year preparation window for the shift to T+1 settlement. The move follows North America’s transition in May 2024, but the European market’s complexity is expected to pose additional challenges.
Val Wotton, Managing Director and Global Head of Equities Solutions at DTCC, noted that research and industry consultations point to one clear priority: automation across the post-trade lifecycle. “Automation of post-trade processes is critical to firms’ preparedness for shorter settlement cycles,” he said in a DTCC comment on the T+1 implementation.
Catalyst
According to Wotton, the shift to T+1 could serve as a catalyst for greater efficiency, reduced risk, and improved liquidity across Europe’s capital markets. Enhanced automation and standardisation are also expected to support broader policy goals, such as the EU’s Savings and Investments Union and the UK’s Competitiveness and Growth agenda.
With the clock now ticking, firms are urged to modernise their systems and strengthen coordination across jurisdictions. DTCC emphasised that clear timelines and collaboration will be essential to ensure a smooth and synchronised transition by 2027.
