What once seemed like a distant compliance deadline, Europe’s move to T+1 is now only 18 months away. After the transition, poor settlement discipline will bring not only financial costs but also reputational harm, making it essential for firms to speed up their preparations.
As experts at The Network Forum’s (TNF) Annual Meeting in Paris noted, automation is only one of the steps which organisations need to take ahead of T+1.
T+1 preparations are gathering momentum. A recent study by The Value Exchange found 79% of EU financial institutions are actively engaged on T+1 initiatives, up from 65% in Q3 2025, before adding that 36% of organisations started their T+1 project work in Q1 2026.
This broadly chimes with a TNF poll, which revealed that 61% of respondents are making steady progress on T+1, and are on track to meet the various deadlines for the UK, Swiss, and EU T+1 Industry Committees’ Recommendations.
Even so, Andrew Douglas, Chair, UK T+1 Taskforce, said the industry still has a lot of work to do. Citing a recent engagement survey, he pointed out that buy-side firms appear to be amongst the least prepared participants. “Typically, the buy-side find themselves waiting for confirmation of the post-trade processes and deadlines from their service providers, meaning they are some way behind other participant types,” he explained.
Douglas warned that financial institutions with regular trade fails face three risks. The first is financial. The second is reputational – firms with high fail rates may discover their counterparties stop trading with them because of the growing costs, and finally, they could become the target of increased scrutiny by regulators.
From pre-trade activities, such as onboardings and Standing Settlement Instructions (SSIs), through to corporate actions, FX, allocations, confirmations, exception handling, and fails management, automation needs to be accelerated, if the rollout of T+1 is to be frictionless.
While automation is critically important for T+1, it is not the only thing firms should be thinking about, commented Helen Adair, Chief Product Officer, Taskize, highlighting the challenges facing some organisations are more fundamental:
“Papering over the cracks is only going to get financial institutions so far with T+1 compliance. Most firms are operating life-cycle management processes which are over 25 years old.”
“The ability to pre-empt and manage flows and breaks is often performed as a purpose after the event rather than as a process before the trade. Behavioural and cultural changes are urgently needed, as well as a shift away from the limited singular view and location strategies, which have created bottlenecks in the settlement process.”
Effective workflow management tools are key enablers for success too: “Proactive workflow management issues are a major barrier to settlement efficiency. Having the ability to pin-point where repeat issues and errors occur, as well as point to point resolutions, is essential.”
Ensuring interoperability across front to back-office communication systems is also non-negotiable if firms are to properly navigate T+1:
“The front office typically uses Bloomberg or Symphony, while the middle and back office tend to deploy Teams. In addition to ensuring interoperability between these communication chains, there needs to be an audit trail in place around what is being shared and executed.”
Just as it did in North America, the industry must double down on systems testing ahead of T+1 to identify and resolve any pain points before the go-live date.
“Technical testing is quite easy to replicate, but what you really want to test for are things like exception handlings and ensuring seamless public holiday hand-offs,” acknowledged one speaker.
T+1 marks the first leg of the shorter settlement journey, with Adair stressing firms should be future proofing their systems not just for T+1, but also T+0. The urgency is underlined by a TNF survey, which found 69% of firms reckon T+0 will be the norm in Europe within 5-7 years of implementing T+1, whilst 10% put it at between 3-5 years.
While Europe is well positioned for T+1, automation alone will not be enough. Firms must also prioritise effective workflow management, joined-up communications and rigorous testing.