UK firms confident on T+1 but not ready, Tokenovate warns

Tokenovate has published research showing a gap between UK post-trade firms' confidence in meeting the move to T+1 settlement and their current operational readiness. While 83% of respondents expect to be fully prepared or on track by the deadline, only 32% said they are fully prepared today.

The findings are based on a survey of 250 senior post-trade professionals in the UK and point to a market that expects to meet the shorter settlement cycle while still grappling with funding, data and process challenges.

The shift to T+1 settlement will cut the time available to complete post-trade activities after a transaction. That will increase pressure on firms to remove manual steps, improve data consistency and coordinate more closely with counterparties and market infrastructure providers.

Only 41% of respondents said their T+1 readiness and wider post-trade transformation programme was fully funded, leaving 59% without a full budget in place as firms prepare for one of the most significant operational changes in UK securities markets in recent years.

External dependencies also emerged as a major obstacle. Four in five respondents said counterparties and market infrastructure providers significantly or severely constrain modernisation, suggesting firms' own efforts may be limited by weaknesses elsewhere in the settlement chain.

Manual work remains embedded across the market despite broad progress in automation. Although 99% of respondents reported at least partial post-trade automation, almost every firm still relies heavily on manual processing in at least one area, including allocation management, reconciliation and trade confirmation.

Data quality and consistency present another challenge. Some 88% of respondents described fragmented data as a critical or significant issue for post-trade efficiency, underlining how widely firms still struggle to maintain a common view of transactions across systems and participants.

The research also points to uneven adoption of common standards. Although 93% of respondents said they were aware of the FINOS Common Domain Model, only 38% said they were actively implementing or using it.

Beyond T+1

Alongside the immediate task of preparing for T+1, many firms are already looking to same-day or instant settlement models. Respondents expect widespread UK adoption of T+0 or atomic settlement within an average of 3.7 years.

That expectation appears to be shaping investment and planning. Nearly four in five said T+0 or real-time settlement is on their agenda, and 46% said they already have a formal roadmap with defined milestones.

Tokenised settlement is also moving into live use or testing, according to the survey. Some 63% of firms said they are already live with or piloting tokenised settlement, while a further 26% said they have formal plans to explore it.

The perceived benefits extend beyond speed. Almost a third of respondents (31%) cited improved interoperability across counterparties and platforms as one of the most important benefits of fully automated, real-time settlement.

Another pressure point is how delayed or fragmented settlement affects firms' balance sheets. The survey found that 98% regarded capital tied up by slow or disjointed settlement as a material cost or risk to their organisation.

UK ambition

The findings suggest many firms see the move to T+1 not as an end point, but as part of a wider redesign of post-trade operations. In that context, the operational gaps highlighted by the survey may matter well beyond the immediate regulatory timetable.

There was also a strong view that the UK could take a leading role in the next phase of market infrastructure change. Some 74% of respondents said the UK is well positioned to lead globally in digital market infrastructure and atomic settlement.

Richard Baker, Founder and Chief Executive Officer of Tokenovate, said: "Confidence around T+1 is encouraging, but being on track is not the same as being operationally ready. Many firms still depend on manual processes, fragmented data and infrastructure outside their direct control. With less time to resolve issues under T+1, those weaknesses will become harder to manage."

He said firms should treat T+1 work as part of a broader transition.

"The market believes widespread UK T+0 or atomic settlement could be less than four years away. Firms need to make sure the work they do for T+1 also prepares them for what follows. That starts with consistent, standardised data, so trades are represented in the same way across systems and counterparties. If we get that right, the UK has a real opportunity to lead."