Accelerating settlement and what T+1 means for Switzerland: Getting ready

This change leaves firms with less time to complete critical post-trade processes. Swiss market participants operating within a tightly interconnected European environment should not wait to get ready – there is limited time remaining to finalise the system updates, tooling and workflows and collaborate with other market participants to meet the October 2027 deadline.

The accelerated T+1 settlement cycle poses operational challenges, but it also offers clear benefits for investors: reduced counterparty risk, faster transfer of equities and fixed income instruments, improved liquidity, and lower margin requirements. However, the transition will require firms to rethink and redesign (at least partially) some of their post-trade procedures, IT infrastructure and workforce capabilities to adapt to this faster-paced environment.  

The transition in Switzerland

The Swiss Securities Post-Trade Council (swissSPTC) is collaborating with their counterparts in the EU and UK to ensure synchronisation of the transition across jurisdictions. This alignment effort is being coordinated through technical task forces and cross-border stakeholder groups, including key Swiss institutions such as SIX, which has a central role as financial market infrastructure provider.

A closer look at what’s changing, and what it means to you

The transition to T+1 will reshape the post-trade lifecycle. Activities that traditionally had two days will now be compressed into just one. Many processes will need to occur on trade date (T+0), including allocation, confirmation, settlement instruction, FX hedging, and liquidity management The change will also impact securities lending and borrowing operations.

Operations must be redesigned to meet more demanding deadlines. Our high-level analysis suggests that at least 20% of post-trade and settlement activities will be overhauled by the move to T+1, triggering changes across entire operating models and the trade processing value chain.

Companies can expect a need to improve their IT infrastructures to allow for faster and more automated processing of client orders and also to assess staffing requirements to guarantee timely processing. Any changes will translate into additional implementation and running costs.

Processes from client interactions through back-office operations need to be streamlined to support the required IT enhancements and to minimise the frequency of exceptions that require manual handling, which could hamper the firm’s ability to comply with the tight deadlines. This will be especially critical in already challenging scenarios around foreign exchange (FX) and the handling of exchange-traded funds, where additional layers of processing could put strain on the shortened settlement window.

Finally, firms will need to ensure that staff are fully trained and equipped with the skills to operate the adjusted systems and procedures and, particularly for larger operations, also maintain effective coordination across jurisdictions. 

Key challenges for Swiss firms

• Time zone alignment: Firms trading with US or Asian counterparts face severe pressures due to shorter processing windows and overnight operations.
• Liquidity strain: Accelerated cycles mean faster access to funds and securities – but will elevate the need for more accurate cash forecasting and treasury readiness.
• Legacy technology and manual processing: These are major obstacles to compressed timelines. Automation is no longer optional: it’s critical.

A pan-European agenda

The European Commission and the European Securities and Markets Authority (ESMA) have confirmed legislative proposals and anticipate that final amendments to the Central Securities Depositories Regulation (CSDR) will enable T+1 implementation by mid‑2026. The time remaining until the go‑live date (11 October 2027) will be used for extensive testing and stakeholder communication. Meanwhile, the UK Accelerated Settlement Taskforce has released detailed guidance that Swiss firms can adopt as a baseline for planning.

In Switzerland, SIX and swissSPTC are working closely to ensure the domestic playbook reflects both European best practices and local market specifics. 

What market participants should do now

In 2025, run gap assessments, plan the rollout and submit budget requests. 2026 should be used for implementation and thorough testing, with testing continuing into 2027 ahead of the October 2027 go‑live.

Swiss financial institutions are encouraged to:

• Conduct a gap analysis, identifying manual dependencies and areas requiring automation in current post-trade processes.
• Engage with custodians, counterparties, and other financial market infrastructure participants early, to ensure alignment on timelines and Service Level Agreements (SLAs).
• Revisit their operating model to evaluate the impact on staffing, technology, and liquidity.
• Plan for rigorous testing cycles in 2027 to ensure readiness across front-, middle-, and back-office functions.
• Establish governance to steer the transition, with accountable owners across legal, risk, trade operations and IT.

Beyond compliance: A strategic opportunity

The shift to T+1 should be viewed as more than mere compliance. Proactive firms can use the transition to modernise legacy infrastructure, automate processes, improve liquidity and reconciliation, and materially reduce settlement risk and operational costs. These upgrades will increase resilience and agility and place institutions in a stronger position as discussions around instant settlement (T+0) gather pace in markets such as India and the US.

By investing now in automation, real-time trade matching and smart liquidity forecasting tools, financial institutions will not only ensure compliance with T+1 but will also position themselves to thrive in a faster, and more dynamic place.

Takeaways from the US implementation of T+1 settlement

In the US, many banks underestimated the effort required to implement T+1 settlement. The accelerated timeline demanded major changes in trade processing, technology, operations, and client communication. Banks and financial institutions with less automation or complex legacy systems struggled to meet same-day affirmation and settlement deadlines.

Many clients underestimated the effort to implement T+1 settlement. The accelerated timeline demanded major changes in trade processing, technology, operations, and client communication:

Lessons learned and insights

• US banks benefit and establish a client communication workstream to educate and engage clients. US banks saw success by targeting clients who frequently submit late trades or have high trade fail rates.
• Banks with fully automated, enhanced processes had a significant advantage in the T+1 US transition and should adopt this as the standard for post-trade processing.
• Complete paperwork on trade day. The SEC now requires trade details to be matched and affirmed the same day. Settlement problems did not spike. Trade fails remained low (around 2%, consistent with before).
• Banks reviewed their key trade processes across the trade lifecycle and pain points to identify weakness and risk (e.g., identification of control gaps, manual touchpoints), and immediately start planning for resolution.
• T+1 settlement shortened the risk exposure period, allowing clearinghouses to lower margin requirements and free up significant capital for market participants.

Impact on day-to-day operations

• Due to earlier daily cut-offs, trading teams now aim to allocate and affirm trades by evening US time on trade day, often using dashboards and escalation processes for any delays.
• Extended coverage hours: Firms added late shifts or follow-the-sun support around the US market close and key cut-offs, especially for global clients.
• Increased process automation, fewer emails based on enhanced straight-through processing tools became essential, raising same-day affirmation rates to around 95% by the 9:00 p.m. ET cutoff.
• Securities lending discipline: Implementation of earlier and automated recall processes which allowed lenders to request the return of loaned securities promptly. Improved inventory forecasting, firms gained better visibility into available shares.
• FX and cash management adjustments: Many non-US managers pre-book or pre-fund dollars and arrange intraday liquidity to avoid last-minute rushes.

Conclusion

The shift from T+2 to T+1 in the EU, the UK and Switzerland offers several benefits to investors, particularly in mitigating counterparty risk and improve liquidity management. However, it will also pose challenges across the securities value chain, which are operationally more complex than those in the US due to the specificities of the European market.

To address these challenges and ensure market participants are ready to comply with the accelerated settlement cycle from Day One, regulators and industry groups have issued recommendations that focus on:

• Ensuring the automation of post-trade and settlement activities, including the improvement of existing IT systems and underlying data quality.
• Strengthening trade matching and confirmation processes to meet updated regulatory and market infrastructure deadlines, including reviewing operations and timings in collaboration with counterparties and partners.
• Review and redesign operational arrangements for key complexity areas, including foreign exchange (FX), securities financing transactions (SFTs), and corporate actions. This should address end‑to‑end workflows, system interfaces, exception handling and cut‑over plans to minimise disruption during the transition.

How Deloitte can help

At Deloitte Switzerland, we bring together deep local market knowledge, regulatory expertise, and cross-border coordination capabilities. We are actively supporting Swiss and European institutions in:

• T+1 impact assessments and target operating model design
• Front-to-back operating model transformation
• Technology and automation enablement
• End-to-end programme management and execution.

Let’s turn this transition into a transformation.

Get in touch to learn how we can support your journey to T+1.

Authors

• Daniel Hirs, Partner,
  Technology & Transformation, Banking Solutions
• Tim Haeseker, Director,
  Technology & Transformation, Banking Solutions
  
• Felix Gieske, Senior Manager,
  Technology & Transformation, Banking Solutions