Scenario 1: Internal Process (T+1 Basis)

Internal Short Settlement occurs when both the buyer and the seller are clients of the same broker. In this case, short delivery is settled internally by the broker rather than through a buy-in auction by the exchange.

• Process:

  # If there is a short delivery, the broker credits funds to the buyer in place of the shares.

  # Correspondingly, the funds are debited from the seller on T+1.

Scenario 2: Exchange Settlement (T+2 Basis)

If shares are not received from the exchange on T+1, the settlement (via funds or shares) is conducted by the exchange on T+2.

• Exception:

  # This does not apply to ‘Z’ category or trade-to-trade shares.