Countdown to T+1: where are we and what comes next?

Successfully transitioning Europe’s markets to T+1 on 11 October 2027 will depend on cross-industry and cross-market collaboration, cooperation and alignment. BNP Paribas recently brought together the region’s three T+1 initiative leaders on a panel for the first time to examine the latest developments taking place across the UK, EU and Switzerland. The panel offered a clear picture of the industry’s current status and valuable insights to help participants navigate the changes ahead.

No time to waste

The key message from all panel participants: 2026 must be the year of action.

The October 2027 deadline won’t change. Andrew Douglas, Chair of the UK Accelerated Settlement Taskforce (AST), anticipates the process to push the Statutory Instrument (SI) through Parliament will begin shortly. Once the law has been changed, “it will be mandatory under the UK CSDR (Central Securities Depositories Regulation) for counterparties to settle on a one-day basis,” he said.

European Union co-legislators have already approved the CSDR amendment that provides the legal basis for the bloc’s move to T+1 on 11 October 2027, added Independent Chair of the EU T+1 Industry Committee Giovanni Sabatini.

In reality though, the effective compliance deadline is December this year, Sabatini warned. Industry participants will need to hit several critical milestones along the way to be ready.

For instance, the AST’s most recent readiness survey from Q3 2025 suggested almost 40% of respondent firms were scheduled to miss the 31 December 2026 deadline for allocation and confirmation processing to be completed by 23.59 on T+0.^[1] “Neither myself nor the UK authorities were happy about that,” said Douglas.

You must get your allocation and matching solutions sorted by the end of this year; everyone is watching!

Onus on automation

“Settling on T+1 will require shifts in processes, procedures and, in some instances, market practices,” noted panel moderator Marie-France Dessertenne, Global T+1 Programme Manager, Securities Services, BNP Paribas.

All the panel participants agreed automation will be key:

• Allocations and confirmations are a particular priority. The new operational timetable for T+1 will slash the time available to solve problems and maintain settlement efficiency rates. “Without automation, the only result will be an increase in headcount costs and settlement fees,” said Sabatini.
• Adhering to market practices on standardisation of trade matching and Standard Settlement Instructions (SSIs) – using the Financial Markets Standards Board template recommended by the UK and EU – is critical.
• Focus on weak links in the clearing and settlement chain. Settlement timing is determined by the least efficient link. Participants need to work with their service providers and counterparties to ensure they aren’t that weak point.

To be ready for October 2027, firms need to start thinking about operations strategically, which is a big mindset shift for the industry, said Douglas. Governance will be key, added Sabatini:

If there is no commitment to allocate human resources and financial resources from top management, you will never see this change of behaviour and attitude, which is key to ensuring a smooth transition.

Collaboration and cooperation

Third-party dependencies mean everyone must work together towards the T+1 transition.

Monthly statistics from the CREST system and published on the AST website show more than 86% of all settlement instructions by volume and value are already received and matched in CREST by the recommended T+1 deadline of 06.00 on T+1. Firms need to examine the other 14% of non-compliant instructions – which are likely to be congregated in certain institutions – to work out why they’re not settling on T+1, said Douglas. “They’re the ones we need to encourage to get on with this task so we can all cross the line together in October 2027.”

In part, there is a chicken-and-egg situation. As Dessertenne observed, to automate, participants need clarity around what actions to take and, given the dependencies, what their providers, clients and counterparties are doing. For example, “we’re still waiting on a lot of responses from the financial market infrastructures about their plans, which will direct what we need to tweak,” she noted.

If firms wait for a 100% complete picture though they will struggle to be ready, Douglas cautioned. “You need to understand what the participants either side of you are doing. But I would argue you have 95% of the information you need today to be able to make progress.”

Start testing

Testing will be a vital part of that progress.

“There will be a series of test dates where all of the infrastructure is aligned, where you can do end-to-end testing,” said Douglas. “But there’s nothing stopping you testing individual components of your solutions now. That’s one of the things I would encourage entities to look at with some urgency.”

Three challenge areas

Some parts of the T+1 transition will be relatively straightforward. Others will take more effort. Three areas Douglas said the Accelerated Settlement Taskforce is now spending more time on are:

1. Stock lending – it will “have to move to T+0 if it’s going to be a success, so that is a real issue,” he noted.
2. FX – solutions exist, so it is possible to do FX in time, said Douglas. “But these things don’t happen organically. You need to go out and research the projects, research the solutions to be able to do that.”
3. Corporate actions – Douglas pointed out that a typical corporate actions department in a global custodian or broker-dealer currently has 15 hours to process a corporate action. In T+1, that is reduced to five. “So, we need to focus more on that.”

SwissSPTC T+1 Task Force chairman Florentin Soliva also raised the issue of corporate actions. Switzerland currently has a near 99% settlement rate for both on-exchange and OTC transactions, with T+2 settlement ready by the end of T+1 in practice already, he noted. As a result, simulations indicate the market will maintain a similarly high settlement rate in a T+1 environment, with no major changes in the operational timetable required to migrate. The biggest prospective operational challenge and main focus for the swissSPTC T+1 Task Force instead is the corporate actions area, he said.

“If this goes wrong, the risks go up,” said Soliva. Cross-border harmonisation and standardisation will be crucial. “We want to have one process in Switzerland and for cross-border.”

“The T+1 project is a unique opportunity for Europe to remove cross-border barriers, starting with corporate actions,” concluded Sabatini. “It’s challenging. But I think the [European] Commission, ESMA and we as an industry cannot miss this opportunity.”

[1] UK T+1 pulse survey (September 2025), The Value Exchange on behalf of the UK Accelerated Settlement Taskforce, 25 November 2025, https://acceleratedsettlement.co.uk/wp-content/uploads/2025/11/UK-T1-readiness-pulse-survey-vF-21-Nov.pdf