On 21 February 2025, the Financial Conduct Authority (FCA) published a speech by Mark Francis (Interim director of wholesale markets sell-side) entitled Our T+1 journey starts now.

Mr Francis warns that firms must now turn their attention to implementing the new T+1 requirement. All firms that participate in wholesale markets are likely to be impacted in some way, but the operational changes and challenges faced will likely differ from firm to firm depending on, among other factors, their business models, the settlement systems they currently utilise and the capacity for those systems to be upgraded. Mr Francis states that if there was only one message that should be taken away from his speech is that firms should start thinking now and put a plan in place as soon as possible to move to T+1 by the deadline.

To meet the new T+1 requirement in time for October 2027 Mr Francis covers the following areas:

• Firms should carefully read the contents of the Accelerated Settlement Taskforce’s report now and identify how best they can be implemented for their firm.
• Firms should not wait until 2027 to put in place relevant changes. Firms must start planning and putting plans into action from now.  Firms should determine what changes are required and how they will need to implement them. One of the key recommendations in the report centres on the operational processes that need to take place to ensure faster settlement, including trade allocations and confirmations as well as the submission of settlement instructions to the Central Securities Depository. Firms are encouraged to consider their own processes and what may need to change to facilitate accelerated settlement.
• Firms should consider any budgeting or resourcing needs for executing the plans they make.
• Firms must take timely action to put their plans into effect and to maintain momentum for the changes needed throughout the transition period. In considering the timeliness for action, regard must be given to testing. Firms are also encouraged to engage with the Accelerated Settlement Taskforce to raise any questions, to flag any difficulties and to make suggestions on what the group may do to make implementation happen more smoothly.

In terms of the FCA’s approach to support T+1 Mr Francis considers the following areas:

• Engagement with firms. The FCA will engage with firms on their T+1 plans as a part of its ongoing supervision. In discussing plans, the FCA would expect firms to cover how they are meeting its expectations on preparedness and how their activities are aligned, or not, with the recommendations as set out in the UK T+1 Code of Conduct. The FCA expects firms to be open with it about their plans and any barriers they may face.
• Communication strategy. Among other things the FCA has launched a new T+1 webpage on its website and this will be updated regularly.
• Market monitoring. The FCA will monitor the market during and after the transition period to help it gauge firm progress on the move to T+1 and identify any issues that need to be addressed.