Securities and Exchange Board of India has asked stock exchanges to submit plans for providing facilities for shifting to T+2 settlement cycle from the current T+3 mode with effect from April 1, 2003.

"It has been decided to further shorten the settlement cycle from the existing T+3 rolling settlement to T+2 from April 1, 2003," Sebi said in a communication to stock exchanges.   

In view of shortening of trade cycle, the new activity schedule has been finalised, Sebi said, adding bourses should provide facility for late confirmation of trades by custodians.

However, the time limit for late confirmation should be fixed and exchanges should levy an additional charge to discourage such delays, it said.

The exchanges should design an alternative clearing and settlement system for companies whose shares have not been dematerialised to align the clearing and settlement system for such stocks with the T+2 rolling settlement.

The stock exchanges should not normally permit changes in the client ID and keep a strict vigil on cases of client code modification, it said.

Besides imposing penalty for frequent modification in the client code, the exchanges could take necessary action against the members making repeated changes.

The bourses could provide facility for online confirmation of trades and system to capture the details of the client's depository account and bank account.