T+1 Settlement System MCQs January 8, 2026September 11, 2025 by u930973931_answers 50 Score: 0 Attempted: 0/50 Subscribe 1. The “T” in T+1 settlement stands for: (A) Trade date (B) Transaction fee (C) Transfer day (D) Tax date 2. In a T+1 settlement cycle, settlement takes place on: (A) Same day of trade (B) Next business day (C) Second business day (D) Weekly cycle 3. T+1 settlement replaced which earlier system in India? (A) T+3 (B) T+2 (C) T+4 (D) T+5 4. The main advantage of T+1 settlement is: (A) Reduced settlement risk (B) Higher brokerage (C) Longer holding period (D) Higher dividends 5. In T+1, if a trade is executed on Monday, settlement will occur on: (A) Monday (B) Tuesday (C) Wednesday (D) Friday 6. T+1 settlement ensures: (A) Faster transfer of securities and funds (B) Delay in payments (C) Weekly matching (D) Margin-free trading 7. Which regulatory body in India mandated T+1 settlement? (A) RBI (B) SEBI (C) IRDA (D) Ministry of Finance 8. T+1 settlement is an example of: (A) Rolling settlement cycle (B) Weekly batch settlement (C) Monthly clearing system (D) Futures settlement system 9. Settlement risk is highest in: (A) T+1 (B) T+2 (C) T+5 (D) T+0 10. Which country introduced T+1 settlement for equities in 2023? (A) India (B) USA (C) UK (D) Japan 11. In T+1 settlement, securities are credited to: (A) Trading account (B) Broker’s pool account (C) Investor’s Demat account (D) Clearing bank 12. In T+1 settlement, funds are credited to: (A) Demat account (B) Investor’s bank account (C) Clearing house account only (D) Broker’s pool account permanently 13. Which type of investors benefit most from T+1? (A) Retail investors (B) Only FIIs (C) Only insurance companies (D) Only mutual funds 14. Which of the following is true about T+1 settlement? (A) Increases settlement time (B) Reduces counterparty risk (C) Delays transfer of ownership (D) Increases market manipulation 15. T+0 settlement means: (A) Trade and settlement on the same day (B) Trade without settlement (C) Settlement after one week (D) No settlement required 16. In T+1 settlement, who ensures delivery of securities? (A) Clearing corporation (B) SEBI (C) Brokers’ association (D) RBI 17. T+1 settlement helps in: (A) Improving liquidity in markets (B) Reducing liquidity (C) Increasing settlement risk (D) Slowing down transactions 18. Which type of trading is impacted most by settlement cycles? (A) Delivery-based trading (B) Intraday trading (C) Futures trading (D) Options trading 19. Settlement efficiency is measured by: (A) Speed and accuracy of fund/securities transfer (B) Dividend payout (C) IPO allotment (D) Broker’s commission 20. Which system supports T+1 settlement in India? (A) NSDL & CDSL (B) RBI & NABARD (C) IRDA & PFRDA (D) WTO & IMF 21. Internationally, T+1 settlement is being adopted to: (A) Align with global best practices (B) Delay capital flow (C) Increase transaction costs (D) Support only large traders 22. One drawback of T+1 settlement for foreign investors is: (A) Less time for funding trades (B) Higher dividends (C) Longer settlement cycle (D) Reduced liquidity 23. In India, full market adoption of T+1 was completed in: (A) 2021 (B) 2022 (C) 2023 (D) 2020 24. T+1 settlement was first implemented in India in a: (A) Phased manner (B) Single-day switch (C) Only for IPOs (D) Only for derivatives 25. T+1 reduces the chances of: (A) Settlement default (B) Bonus issue (C) Dividend payment (D) IPO subscription 26. Settlement under T+1 happens via: (A) Clearing corporations (B) Ministry of Finance (C) Company registrar (D) Mutual funds 27. A shorter settlement cycle like T+1 enhances: (A) Investor confidence (B) Settlement risk (C) Speculation (D) Price manipulation 28. Which global market still uses T+2 settlement? (A) US (before 2024) (B) India (C) China (D) None 29. Faster settlement cycles can reduce: (A) Market volatility risk (B) Trading volume (C) Dividends (D) IPOs 30. T+1 settlement requires brokers to: (A) Collect funds from clients faster (B) Delay payment collection (C) Cancel all orders (D) Pay dividends directly 31. In T+1, securities are delivered by: (A) Seller’s broker (B) Depository (C) Mutual funds (D) SEBI directly 32. T+1 is considered better than T+2 because: (A) Quicker ownership transfer (B) Higher brokerage fees (C) Longer liquidity gap (D) Fewer retail trades 33. Which market participants had concerns with T+1 initially? (A) Foreign investors (B) Retail investors (C) Brokers (D) Mutual funds 34. Shorter settlement cycles like T+1 help in: (A) Reducing systemic risk (B) Increasing systemic risk (C) Reducing liquidity (D) Delaying ownership 35. In T+1 settlement, the obligation is settled through: (A) Funds and securities transfer (B) Dividend payout (C) Corporate action (D) IPO allotment 36. In India, the two depositories that support T+1 are: (A) NSDL and CDSL (B) RBI and SEBI (C) NSE and BSE (D) FII and DII 37. One challenge in T+1 settlement for global investors is: (A) Time zone differences (B) High dividends (C) Long-term holding (D) No clearing corporation 38. Settlement cycles shorter than T+1 are called: (A) Same-day settlement (T+0) (B) Weekly cycle (C) Phased settlement (D) Deferred settlement 39. T+1 settlement applies to: (A) Equity shares (B) Commodities (C) Mutual funds (D) Insurance 40. Faster settlement helps: (A) Increase trading turnover (B) Decrease investor participation (C) Block capital longer (D) Avoid dividends 41. In T+1, trades executed on Friday are settled on: (A) Saturday (B) Monday (C) Tuesday (D) Friday itself 42. The move to T+1 globally is led by: (A) Technological advancement in clearing systems (B) Dividend policies (C) IPO subscriptions (D) Mutual fund NAV 43. T+1 settlement is part of which broader market reform? (A) Market modernization and digitization (B) Dividend reform (C) Mutual fund regulation (D) IPO allotment 44. Which Indian exchanges follow T+1 settlement? (A) NSE and BSE (B) NSDL and CDSL (C) RBI and SEBI (D) MCX only 45. One benefit of T+1 for investors is: (A) Faster access to funds/securities (B) Longer waiting for shares (C) Delay in trading (D) No liquidity 46. Settlement failure risk is minimized under: (A) T+1 (B) T+5 (C) Weekly system (D) T+2 47. Which type of settlement is risk-free and immediate? (A) T+0 (B) T+1 (C) T+2 (D) T+5 48. In T+1, the clearing corporation acts as: (A) Central counterparty (B) Dividend payer (C) IPO registrar (D) Investor’s bank 49. A shorter settlement cycle like T+1 encourages: (A) Higher retail participation (B) Less retail participation (C) Only institutional trading (D) Block trading only 50. T+1 settlement is considered a step toward: (A) T+0 (same-day settlement) (B) T+5 (C) Deferred settlement (D) Longer credit cycles