Foreign funds have asked market regulator Securities and Exchange Board of India (SEBI) to defer implementation of the T+1 settlement system.

Three offshore fund lobby groups – the Asian market and Financial Markets Association (ASIFMA), Traders Forum of Hong Kong and therefore the UK-based Investment Association – have sent a joint letter to SEBI Chairman Ajay Tyagi, The Economic Times has reported.

“We strongly urge Sebi to delay the approaching into effect of the circular that’s scheduled for January 1, 2022, in order that all stakeholders have sufficient time to spot , come up with, test and implement the operational processes and procedures required to securely implement a T+1 settlement model in India,” said the letter addressed to Tyagi, as quoted by the publication.

The organisations allege that they weren’t consulted on the new rules.

SEBI had not yet responded when contacted by The Economic Times.

Neither FPIs nor their custodians in India were consulted before the SEBI circular was issued on September 7,” Eugenie Shen, director , head of the asset management group at ASIFMA, told the publication.

The market regulator, on September 7, introduced T+1 (Trade plus 1 day) rolling settlement cycle for equity transactions on an optional basis. The new rule will inherit effect on January 1, 2022.

BSE CEO and MD Ashishkumar Chauhan told BloombergQuint that the T+1 settlement cycle is sure to be implemented from 2022.