T+2 System to be Implemented from Magh 11

In view of the increasing use of technology in Nepal's stock market and international practice, the authorities associated are working to implement the T+2 system of settlement.

CDS and Clearing Limited (CDSC) had previously submitted a proposal to the board to change the current settlement T+3 system to T+2. SEBON had then approved the proposal. T+3 means that it takes 3 days for the settlement of securities traded. Thus, buyers receive the shares that they buy in about three days. Now that SEBON has approved the T+2 system, the settlement process for the shares traded will hopefully take lesser time.

CDSC also had a discussion today with the representative of the Stock Brokers Association of Nepal. The authorities are positive to implement the system from as early as Magh 11. However, they presented their concern that some investors delay EDIS after selling their shares. This obstructs the entire settlement system.

It is a frequent complaint from investors that they do not get the shares and payment on time. Although the system is T+3 in theory, clients do not receive their payment even after a week of selling. Since the concerned authorities seem invested to improve and speed up the settlement system, investors can hope that the stock market will be more fluid in the days to come.