With the two-year countdown on until T+1 settlement becomes mandatory in the UK, EU and Switzerland on 11 October 2025, the UK Accelerated Settlement Taskforce has re-emphasised that automation and ensuring key milestones are met are more important than ever to prepare for the transition.
Andrew Douglas
Andrew Douglas, chair of the Accelerated Settlement Taskforce said: “This milestone should serve as a reminder to firms that they need to start preparing now, if they haven’t done so already.
“Whilst there’s a lot of work to do, we know that the rewards will be meaningful. Accelerated settlement will deliver greater efficiency, enhanced resilience, reduced risk, and improved liquidity within our capital markets.”
According to research produced in April by the ValueExchange, led by the UK Taskforce and sponsored by Euroclear, The Depository Trust & Clearing Corporation (DTCC) and several industry associations, 62% of global firms have started preparations for the UK’s transition to T+1 in October 2027.
Meanwhile, 26% of respondents indicated at the time that they will miss the target date.
With this in mind, as the deadline looms closer, aspects such as implementing automation backed by good data is essential, to ensure that the transition does not follow the North American shift where a lack of investment in automation led to increased costs.
“We have a chance to leverage our second mover advantage. The main lesson learned from the North American transition is the importance of automation backed by good data to keep costs down, so we urge firms to make automation a priority when preparing for T+1,” added Douglas.
Read more – Inside the UK’s blueprint for the move to T+1 settlement
This was further emphasised at the recent Euroclear Modernising Securities Markets conference, where panellists agreed that settlement efficiency can be achieved in 10 seconds with proper automation, however this is often hindered by industry-wide challenges of adoption and enforcement.
Speaking at the conference on the impact of ineffective settlement automation on the transition, Tim Mcleod, global head of lending and liquidity operations at BlackRock, said: “On average in Europe market participants pay €70 million in cash penalties for failed trades. If you add that to a full year and round up, its €850 million that we’re paying in penalties.
“If we don’t transition to T+1 in a way that improves our settlement rates, I would say even standing still is going to see us past a billion. And are we really comfortable with a billion euros?”
Read more – Settlement failure costs could soar into the billions under T+1 without automation and strong data standards
Moreover, the UK Taskforce also highlighted the importance of ensuring that firms have completed interim deadlines by the end of 2025 to enable a smooth transition.
Specifically, these milestones include reviewing the plan and calculating the impact on the firm, designing a development plan to deliver T+1 capability and securing a delivery budget.