SEBI to launch net settlement framework for FPIs by 2026
SEBI is set to launch a net settlement framework for Foreign Portfolio Investors (FPIs) by the end of 2026.
The idea is to make investing smoother: FPIs will now be able to net their outright buys and sells within a cycle, which should lower both liquidity pressures and transaction costs.
But if someone buys and sells the same security, those deals will still settle separately.
FPIs's gross settlements continue, taxes apply
Gross settlements between FPIs and their custodians are not going away, so risk controls stay strong.
Usual charges such as securities transaction tax and stamp duty will still apply.
To make this shift work, exchanges and custodians need some technology upgrades, and market stakeholders will be consulted as implementation standards are developed so things roll out smoothly for everyone involved.