UK T+1 Readiness: Re-engineering the Post-Trade Value Chain
Video Transcript
The UK’s move toward a T+1 settlement cycle is set to reshape the landscape of post-trade operations.
By shortening the settlement window from two days to just one, the industry is aiming for greater efficiency and reduced risk.
But this transition also highlights long-standing challenges, like fragmented systems, manual processes, and limited real-time visibility.
Many firms still rely on spreadsheets and overnight batch processing, which simply won’t keep up under T+1’s compressed timelines.
The key to readiness is automation.
Firms that invest in modern, modular post-trade systems can streamline trade capture, affirmation, and settlement, while reducing operational costs and settlement fails.
Lessons from North America show that those with real-time, integrated platforms transitioned smoothly, while manual workarounds struggled.
For UK brokers, custodians, and banks, T+1 is more than a compliance deadline, it’s a chance to rethink operations, improve client service, and gain a competitive edge.
By prioritising automation, enhancing data visibility, and collaborating across the ecosystem, firms can turn regulatory change into commercial advantage and build a more resilient future for UK capital markets.
UK T+1 Readiness: Re-engineering the Post-Trade Value Chain, whitepaper written by our Chief Commercial officer, Gaurav Mehta.
You can go to the articles section on our website nova.contemi.com to read the detailed whitepaper.
To learn more, visit nova.contemi.com? or contact us at info@contemi.com to? book a demo.
Executive Summary
The UK’s journey toward a T+1 settlement cycle represents one of the most significant inflection points in the evolution of global capital markets. While the transition promises greater efficiency and reduced counterparty risk, it also exposes long-standing structural weaknesses in post-trade operations.
The shift from T+2 to T+1 compresses timeframes, challenges legacy systems, and demands a level of automation and integration many firms are still striving to achieve.
This white paper explores what T+1 readiness really means from a post-trade and commercial perspective — the operational, technological, and business imperatives that brokers, custodians, and banks must address to remain competitive. It also outlines how automation-first, modular post-trade systems — such as Contemi’s NOVA platform — are enabling firms to turn regulatory change into commercial advantage.
1. The Regulatory and Market Context
The Accelerated Settlement Taskforce (AST) has signalled that the UK aims to transition to T+1 by 2027 — a move designed to preserve London’s competitiveness and align with North American markets.
Yet, readiness across the industry remains uneven. European settlement-fail rates hover between 5–8%, compared to ~2% in the US, and market data suggests these could double under T+1 without structural change.
This is not just a compliance milestone; it’s a strategic moment for firms to rethink post-trade resilience, reduce cost per trade, and improve capital efficiency.
2. The Post-Trade Bottleneck
Despite years of digital transformation, post-trade remains one of the least automated functions across the financial services value chain.
Firms continue to struggle with:
- Fragmented systems for trade capture, allocation, confirmation, and settlement
- Manual intervention and reconciliation via spreadsheets and email
- Overnight batch processing that breaks under compressed timelines
- Limited visibility of real-time trade and funding positions
Under T+1, these inefficiencies translate directly into higher fail rates, liquidity drag, and reputational risk. The reality is simple: T+1 readiness equals operational automation.
3. Redefining Readiness: Beyond Compliance
Operational Readiness
- Same-day affirmation (SDA) embedded across workflows
- Intelligent exception management and automated escalation
- 24x6 operations support with proactive monitoring
Technological Readiness
- Seamless integration of front-to-back systems via open APIs
- Cloud-enabled scalability and real-time data availability
- Modular design enabling targeted modernisation — not full replacement
Control & Data Readiness
- Centralised trade repository providing a single source of truth
- Continuous reconciliation and intraday reporting
- Configurable dashboards for compliance, operations, and clients
4. Lessons from North America
The US T+1 go-live in May 2024 demonstrated a clear divide between firms that had invested in automation and those that had not.
Key Insights
- Firms with real-time affirmation and integrated systems transitioned smoothly.
- Manual workarounds failed under compressed time windows.
- Funding and liquidity management became critical risk points for firms that lacked transparency.
The UK has a unique advantage — the ability to learn from the US experience and build readiness deliberately, rather than reactively.
5. The Business Case for Post-Trade Modernisation
| Metric | Legacy Post-Trade | Modern Automated Post-Trade |
|---|---|---|
| Settlement Fail Rate | 5–8% | <2% |
| Manual Touchpoints per Trade | 12–15 | 1–2 |
| Cost per Trade | £3–£5 | £1–£2 |
| Affirmation Time | Hours to Overnight | Minutes |
| Exception Handling | Manual | Automated & Predictive |
6. The NOVA Approach to T+1 Readiness
At Contemi NOVA Post-Trade, we help financial institutions modernise their post-trade lifecycle through an automation-first, modular architecture.
Our platform delivers:
- Real-time trade processing — from capture to settlement
- Automated affirmations and exception management
- Cloud-ready scalability to support global operations
- Seamless integration with OMS, custodians, and clearing houses
NOVA’s modular design means firms can upgrade at their own pace, aligning commercial priorities with operational needs. Our clients have reported up to 60% reduction in settlement fails and 30–40% lower post-trade operating costs after migration.
7. The Path to Readiness: A Strategic Roadmap
8. The Commercial Imperative
For leadership teams — CEOs, COOs, and CFOs — the T+1 shift represents more than an operational challenge. It’s a board-level opportunity to:
- Strengthen client trust through flawless execution
- Reduce capital and liquidity costs
- Improve operational efficiency and margin
- Differentiate through service reliability and transparency
In an era of squeezed margins, those who modernise their post-trade infrastructure first will capture market share and profitability from those who delay.
9. Conclusion: From Obligation to Advantage
The move to T+1 is inevitable — but the outcomes are not. Firms that approach it strategically, as an opportunity to future-proof their operations and business model, will emerge stronger.
At Contemi NOVA, we’re helping clients do just that — delivering post-trade automation that turns compliance into competitive advantage. Because readiness isn’t just about meeting deadlines. It’s about building smarter, faster, more resilient capital markets for the decade ahead.
Gaurav Mehta
Chief Commercial Officer
Leave a Reply