The UK’s move to a T+1 securities settlement cycle on 11 October 2027 is drawing closer. In our previous article, we outlined the changes for which firms would need to plan. The FCA’s latest piece, entitled, T+1 Settlement: are firms ready for 2027? | FCA, makes clear that attention has now turned to implementation; firms should be able to show what they have changed, what remains outstanding and how they will test their arrangements.
What has the FCA found?
The FCA reports that many market participants are progressing well. Some have completed most of their systems changes and expect to begin testing this year. Others remain considerably behind; some had yet to finalise a project plan or identify the changes needed for T+1. The FCA has also highlighted concerns about buy-side readiness and says it will pay particular attention to progress in that sector.
The message for firms is straightforward; a project plan alone will no longer demonstrate readiness. The FCA expects firms to be advancing implementation during 2026 and preparing to test their changes from the start of 2027. It has said that its supervisory approach will become increasingly intrusive as the transition approaches.
Priorities for the remainder of 2026
The UK Accelerated Settlement Taskforce’s critical recommendations include allocating and confirming trades by the end of trade date and adopting the Financial Markets Standards Board’s standard for sharing standing settlement instructions (SSIs). The FCA has reminded firms to focus on recommendations with a December 2026 deadline and to finalise their testing plans with reference to the UK/EU joint testing plan.
Firms should therefore review where manual steps, late allocations, SSI mismatches or inventory issues could delay settlement. They should also be able to identify their settlement failure rate, the main causes of failed trades and the action being taken to improve performance. These measures will help firms assess whether their processes can operate within a shorter settlement cycle.
Dependencies across the settlement chain need equal attention. The FCA has encouraged firms to engage with clients, counterparties, custodians and service providers. It has also called on third-party providers to share their T+1 plans and deadlines with clients now, so that firms can complete their own preparations.
For buy-side firms, fund settlement timings present a further consideration. Industry bodies have recommended moving fund settlement cycles to T+2 on or before 11 October 2027 to limit the mismatch with T+1 securities settlement. The FCA observed that, although many firms intend to do so, only a minority of those it spoke to had concrete plans.
What should firms do now?
Firms affected by the transition should use the remaining months of 2026 to:
- Check delivery against their T+1 plan, with clear owners and dates for outstanding systems and process changes.
- Measure current settlement performance and investigate recurring failures, particularly those linked to allocations, SSIs and inventory.
- Confirm external dependencies, including the changes and deadlines set by clients, custodians and other providers.
- Finalise a testing strategy covering internal processes and relevant market-wide testing in 2027.
- Report progress through governance channels, recording decisions, unresolved risks and remediation.
The precise work will depend on each firm’s activities and its role in the settlement chain. What matters now is that firms can evidence progress and demonstrate a credible route to readiness before October 2027.
How Complyport can help?
Complyport can support firms preparing for T+1 through:
- Readiness reviews: Assessing trading and settlement workflows, current performance and gaps against the relevant transition milestones.
- Implementation and third-party oversight: Helping firms develop action plans, track dependencies on custodians and service providers, and prepare for testing.
- Governance and documentation: Updating procedures and management reporting so firms can evidence progress, decisions and outstanding risks.
To discuss how the move to T+1 affects your firm, contact Complyport to speak with one of our specialists.
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To understand how these regulatory developments may impact your business and to discuss your compliance needs, contact Complyport today to book a meeting with one of our Subject Matter Experts.
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