In a key step towards modernising its financial market infrastructure, the UK is poised to adopt a T+1 settlement cycle for securities trades by 11 October 2027.
According to Finextra, this advancement follows the recommendations from the Accelerated Settlement Taskforce, chaired by Charlie Geffen since December 2022, aimed at expediting the settlement of securities trades. The taskforce’s findings were detailed in a report released on 28 March 2024, suggesting the UK could enhance market efficiency significantly by moving from the traditional T+2 settlement cycle to T+1.
The report outlines a comprehensive implementation plan to facilitate this transition, highlighting 12 critical actions and 27 highly recommended strategies. These steps are designed to ensure the UK financial markets can adopt the faster settlement cycle effectively, aiming to position the UK as a leader in financial market efficiency globally.
The UK government has expressed its support for these changes, recognizing the potential benefits of reduced market risk and increased liquidity. It anticipates delivering a formal response soon, which will provide further details on how these recommendations will be implemented.
HM Treasury’s Charlie Geffen remarked, “The move to a T+1 settlement cycle represents a significant milestone in the evolution of UK financial markets, aiming to enhance competitiveness and reduce risks for investors.”
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