On 26 January 2026, the Investment Association published a report in relation to T+1 Settlement Navigating the UK EU and Swiss Transition (the Report).

Summary

The Report provides a roadmap of the UK and European Union securities markets from a trade-date-plus-two (T+2) to a trade-date-plus-one (T+1) settlement cycle, currently targeted for 11 October 2027. It highlights the critical operational, technological and liquidity challenges introduced by T+1, serving as a guide for investment managers specifically and Market Participants (MPs) to prepare for T+1 implementation across the European market. The Report complements existing regulatory documentation such as the UK Accelerated Settlement Taskforce’s guidelines, focusing on the downstream impacts to fund and cash operations.

As T+1 compresses the post-trade window, the Report outlines recommendations for MPs to act now, ensuring they are fully resourced or governed for the transition programme; that they advance automation across trade release, allocation and matching processes; reassess foreign-exchange (FX) processes and resource models including coverage windows, execution arrangements and liquidity monitoring; align fund settlement cycles by the deadline; and, improve accurate standing settlement instructions (SSIs) to reduce avoidable settlement failures and Central Securities and Depositories Regulation penalties.

Impacts for firms

The Report also highlights four areas that will impact firms with detailed timelines and recommendations. In particular:

  • Trade allocations, confirmations and matching: The Report makes certain recommendations for firms including to establish T+0 confirmations now; review place-of-settlement and place-of-safekeeping in line with CTM’s deadline as of end of December 2025; map trade lifecycles and prioritise automation.
  • Settlement: Key recommendations in relation to settlement include aligning instruction details across counterparties and ensuring firms can execute and fund FX efficiently. This also includes considering outsourcing portions of FX to custodian banks or others, enabling partial settlement, mapping cut-offs for custodial agents, enhancing securities lending recalls and inventory management processes.
  • Fund cycles: The recommendations in this section of the Report highlight the need to prepare for the move to T+2 fund settlement, supported by updates to valuation processes, cash movement workflows, documentation, and investor servicing arrangements.
  • Broader strategic or operational themes: The report highlights that, as firms assess their operating models, strengthening foundational data (particularly the accuracy and consistency of SSIs) will be central to reducing friction across the value chain. The recommendations in this section focus on enhancing operational resilience, improving cross-party alignment, and ensuring internal and outsourced functions can consistently support T+1 settlement.