S. Korea Pushes for T+1 Stock Settlement Cycle
1Currently, it takes two days to receive cash after selling stocks in S. Korea.
2The President questioned this, prompting a push for a one-day settlement system.
3Following the US, S. Korea plans to upgrade its system and adopt it soon.
📖 Easy Explanation
🔍 Background
Currently, you must wait two business days to receive money after selling stocks, known as 'T+2'. Recently, the President questioned why it takes so long, sparking active discussions to reduce this period to one day.
📌 Key Points
It traditionally took two days for brokerages and exchanges to verify and settle trades. However, with advanced IT systems, the US already adopted the 'T+1' system last year. S. Korea's exchange and depository are now actively preparing to shorten the settlement period to one day.
💡 Why It Matters
Once implemented, investors can withdraw cash just one day after selling stocks. This will be much more convenient for urgent cash needs and will accelerate the flow of money in the stock market.
🔮 What's Next
It will take time to upgrade brokerages' IT systems, so immediate changes are unlikely. S. Korea will likely adopt it around the second half of next year, aligning with Europe's transition.
📚 Glossary
결제주기 (Gyolje-jugi)The time it takes for actual money and stocks to be exchanged during a trade (Settlement cycle).
T+2A system where money is received two days (+2) after the trade date (T).
T+1A system where money is received the day after (+1) the trade date.
미수거래 (Misu-georae)Buying stocks with borrowed money from a brokerage, requiring the balance to be paid later (Margin trading).