PSX to Implement T+1 Settlement Cycle by 2026

The Securities and Exchange Commission of Pakistan (SECP) has revealed plans for the Pakistan Stock Exchange (PSX) to transition to a T+1 (trade-plus-one) settlement cycle, effective February 9, 2026. This initiative is geared towards the modernization of Pakistan’s capital markets.

SECP Chairman Akif Saeed announced the decision at a Karachi event. Attendees included representatives from the PSX, National Clearing Company of Pakistan (NCCPL), Central Depository Company (CDC), PMEX, security brokers, banking institutions, and other industry participants.

The shift from the existing T+2 to a T+1 cycle is intended to boost market effectiveness, clarity, and safeguards for investors by speeding up the settlement procedure and lessening vulnerability to credit and market uncertainties. The quicker settlement period is also projected to enhance available capital and lower the likelihood of defaults resulting from market instability or functional hold-ups.

The SECP Chairman described the move as a considerable achievement, noting that Pakistan is aligning with prominent global markets, including the United States, China, Canada, Mexico, and Argentina, all of which have already implemented or are implementing the T+1 framework.

Under the guidance of the SECP, NCCPL is leading the transition, with a specialized implementation committee supervising the procedure. The committee is composed of representatives from the SECP, capital market infrastructure institutions (CMIIs), custodial banks, and securities brokers. Discussions have also taken place with international investors to guarantee a seamless changeover.

To support functional readiness, NCCPL has created a comprehensive plan and procedural manual to aid market players in identifying and resolving potential challenges before the change. The SECP Chairman has encouraged all parties involved to start assessing and improving their systems to comply with the updated settlement timeframe.

Market analysts consider this development as a vital reform that highlights the increasing maturity and flexibility of Pakistan’s financial markets. The initiative further strengthens continuous efforts to bring the capital market into line with global standards.