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ECB Executive Board member Piero Cipollone said Europe is scheduled to move to next-day securities settlement on Oct. 11, 2027. The Eurosystem plans changes to its T2S settlement platform in June 2027, while separate work on tokenised assets and settlement in central bank money continues. Cipollone said implementation and testing still need to progress.
Europe is scheduled to move to next-day securities settlement on Oct. 11, 2027, cutting the standard period between a trade and the exchange of cash and securities from two days to one. European Central Bank Executive Board member Piero Cipollone outlined the timetable at an EU T+1 Industry Committee event in Frankfurt on Oct. 29, saying that preparations and testing must continue ahead of the change.
Cipollone described T+1 as both a change to settlement timing and part of a broader effort to modernise Europe’s financial infrastructure. A shorter settlement cycle can reduce the period in which buyers and sellers are exposed to market and counterparty risk, he said. It will also put pressure on post-trade processes that currently rely on longer timelines, increasing the need for standardisation and automation.
The Eurosystem operates TARGET2-Securities (T2S), which settles securities transactions in central bank money and can exchange cash and securities simultaneously. Cipollone said T2S already handles substantial volumes on a T+1 and even a T+0 basis. The platform is not starting from scratch, but its processes are being adapted for the market-wide shift. Changes to its night-time settlement process are planned for June 2027, several months before the scheduled migration.
The address also linked settlement reform to the Eurosystem’s work on tokenised finance. Cipollone said the Eurosystem has accepted certain securities issued in central securities depositories using distributed ledger technology as eligible collateral for credit operations since March 30, 2026. Since Sept. 21, the Eurosystem’s Pontes service has enabled wholesale transactions in tokenised assets to settle in central bank money, connecting market DLT platforms with TARGET Services.
Why Shorter Settlement Matters
Moving to T+1 gives market participants less time to complete the work between trade execution and settlement. That can reduce the period of exposure to unsettled trades, but it also leaves less room to resolve processing delays, funding issues or mismatched transaction details. The practical effect will depend on how effectively firms and market infrastructure providers adapt their procedures before the change.
For Europe, the reform also has a cross-border dimension. Cipollone said more efficient post-trade infrastructure can make it easier for capital to flow across borders and for investors to access European markets. Those are stated policy aims, not proof that the settlement change alone will deepen capital markets or improve competitiveness. The speech presents T+1 as one part of a wider programme, alongside payment modernisation and work on digital finance.
The connection with tokenisation is relevant because both efforts concern how financial transactions are processed and settled. T+1 tightens the timetable within existing market infrastructure; DLT-based systems could change how securities and related services are organised. The ECB’s stated work on Pontes and collateral eligibility shows that the Eurosystem is testing links between new market platforms and settlement in central bank money. The two developments are related in the address, but the speech does not say that tokenisation is required for the T+1 move.
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From T+2 to T+1
Under the current T+2 convention, settlement generally takes place two business days after a securities trade. The planned Oct. 11, 2027, change would shorten that interval to one business day. Cipollone delivered his remarks at an event titled “One year to T+1,” hosted by the EU T+1 Industry Committee in Frankfurt on Oct. 29, 2026.
The ECB, the European Securities and Markets Authority and the European Commission support preparations for the change, according to Cipollone. He credited coordination through the industry committee with helping public authorities and private firms work toward common solutions in a fragmented European market. The remarks did not provide a detailed progress scorecard or name specific firms’ readiness levels.
In parallel, the Eurosystem is pursuing several strands of financial infrastructure work. The speech describes DLT-based collateral and Pontes as steps already taken, while saying the Eurosystem is still assessing whether and under what criteria assets outside currently eligible settlement systems could qualify as collateral. Any such framework would remain subject to the requirement that collateral be adequate.
“T2S already supports shorter settlement cycles.”
— Piero Cipollone, ECB Executive Board member
Readiness and Tokenisation Criteria
The scheduled migration date and the planned June 2027 T2S changes are stated in Cipollone’s address, but the speech does not give detailed milestones for every market participant or report how ready individual firms are. It also does not specify which operational risks remain outstanding, how testing results will be published, or whether the timetable could change.
The future scope of tokenised collateral is also unresolved. The Eurosystem is assessing whether assets issued outside currently eligible settlement systems could qualify, and under what conditions. Cipollone did not set out final eligibility criteria or a decision date. The speech describes potential efficiencies from tokenisation but does not quantify expected savings or confirm that the technology will simplify Europe’s financial architecture.
Testing Before October 2027
Market participants and European authorities are expected to continue implementation work and testing ahead of the migration. The next dated infrastructure milestone cited by Cipollone is the planned June 2027 update to T2S night-time settlement processes. The market-wide shift is scheduled for Oct. 11, 2027.
The Eurosystem also plans to continue working with market participants and authorities on the transition. Separately, it will continue assessing the possible eligibility of additional DLT-based assets as collateral. The address did not give a timetable for that assessment or announce further Pontes milestones.
Key Questions
What does T+1 settlement mean?
T+1 means a securities trade is scheduled to settle one business day after it is executed, rather than two business days later under T+2. Settlement is when the buyer receives the securities and the seller receives payment.
When is Europe scheduled to move to T+1?
The date given by ECB Executive Board member Piero Cipollone is Oct. 11, 2027. His remarks were delivered at an industry event in Frankfurt on Oct. 29, 2026.
What changes are planned for T2S?
The Eurosystem plans changes to T2S’s night-time settlement process in June 2027. Cipollone said the platform already supports substantial T+1 and T+0 settlement volumes, but needs adaptations for the wider market timetable.
Is tokenisation part of the T+1 change?
The address discusses tokenisation as part of a broader financial infrastructure programme, not as a condition for the T+1 migration. The Eurosystem has begun settling some wholesale transactions in tokenised assets in central bank money through Pontes, while further collateral eligibility remains under assessment.
What remains uncertain?
The speech does not detail readiness across firms, final testing results, or the criteria and timing for any expanded eligibility of DLT-based collateral. It also does not quantify the financial benefits expected from T+1 or tokenisation.
Source: bis.org
