Lessons from the US move to T+1

In this episode of FinTech Focus TV, Toby Babb is joined by David Kirby, the Managing Director at The Depository Trust & Clearing Corporation (DTCC), to discuss the future of global financial markets, particularly focusing on the transformative transition to the T+1 settlement cycle. Recorded live at the FIX Americas Trading Event in New York City, this insightful conversation covers the complexities of market efficiency, the growing importance of automation, and how collaboration across the industry has become the cornerstone for achieving streamlined and more efficient global trading systems.

David shares valuable insights on how DTCC, the world’s largest securities depository, has played a pivotal role in reshaping the settlement cycle, and how lessons from the U.S. market can be leveraged to benefit global markets. The episode also explores the evolution of the financial industry from competitive silos to a more collaborative environment—an essential shift that is enabling progress in an increasingly interconnected world of finance.

As a leading recruitment business in the FinTech space, Harrington Starr understands how critical these changes are for the financial services industry and how they are shaping demand for skilled professionals across the sector. This podcast provides a timely opportunity to explore the future of financial market infrastructure, where collaboration, technology, and talent play a central role in the evolution of financial markets.

The Role of DTCC in Shaping Financial Infrastructure

David Kirby opens the conversation by discussing the role of DTCC as the largest securities depository globally, with a primary focus on the U.S. market. DTCC is a key player in the financial services ecosystem, providing a range of services that span clearing, settlement, depository functions, and more. The company’s operations touch almost every aspect of the financial markets, from equities to derivatives, and it has been instrumental in driving forward important initiatives like the T+1 settlement cycle.

The T+1 settlement cycle, which refers to the reduction of the time between a securities trade and its settlement from two days (T+2) to one day (T+1), is one of the most significant changes in the financial market infrastructure in recent years. David explains that while there was considerable anticipation and concern prior to the transition, particularly around the possibility of an increase in trade failures or delays, the final result was overwhelmingly positive. The transition to T+1 was largely smooth, with no major increases in failure rates or decreases in affirmation rates. According to David, this was a testament to the extensive planning, collaboration, and effort invested by the industry as a whole.

For companies like us at Harrington Starr, who operate within the FinTech recruitment sector, the evolution of the financial infrastructure directly impacts the demand for talent. As financial institutions embrace automation and new technologies to meet the challenges of faster settlements and greater market efficiency, the need for highly skilled professionals in technology, operations, and regulatory compliance will only continue to grow.

Collaboration Over Competition: The Key to T+1 Success

A central theme in the podcast is the shift in the financial services industry from competition to collaboration. In the past, companies in the financial markets were often more focused on competing against each other than on working together for the greater good of the industry. However, as David highlights, the transition to T+1 proved that collaboration is crucial to achieving large-scale industry change.

The collaboration between DTCC, ICI (Investment Company Institute), SIFMA (Securities Industry and Financial Markets Association), and Deloitte was a critical factor in the success of the T+1 transition. Together, these organizations developed a comprehensive “playbook” that laid out the necessary steps to facilitate the move from T+2 to T+1. This playbook, based on lessons learned from the previous transition from T+3 to T+2, was an essential resource that allowed the industry to leverage existing knowledge while building on it to create a smoother, more efficient transition.

David emphasizes that the key to success wasn’t just about the technical aspects of shortening the settlement cycle, but also about ensuring that every participant in the financial ecosystem—from custodian banks to buy-side firms and broker-dealers—was aligned with the common goal. The sense of collaboration extended to every facet of the transition, from operational improvements to communication and education efforts.

This collaborative approach has far-reaching implications for the FinTech recruitment sector. As the industry moves toward more collaborative models, the need for professionals who can work across silos and communicate effectively with a diverse range of stakeholders becomes increasingly important. At Harrington Starr, understanding these trends helps us better serve our clients and candidates, connecting them with the talent needed to thrive in a more integrated financial services landscape.

Lessons from T+1: The Road to Global Market Efficiency

The success of the T+1 transition in the U.S. offers valuable lessons that are now being applied to global markets, particularly in Europe and other regions. As markets around the world prepare to adopt a similar settlement model, David shares key insights into how these lessons can help smooth the transition in other regions. He stresses that starting early is essential for a successful implementation.

The T+1 transition in the U.S. was no small feat, and David explains that it was crucial to begin the planning process well in advance. Financial institutions and market participants needed time to understand the impact of the change, adapt their systems, and ensure that the transition was as seamless as possible. Moreover, automation played a key role in the success of the U.S. transition. David notes that while automation was important for the initial phase of T+1 in the U.S., it will be even more critical as the process is rolled out globally.

David further explains that the transition to T+1 should not be viewed as a one-off event, but rather as part of an ongoing evolution in financial markets. As global markets become more interconnected, the demand for greater operational efficiency will continue to drive change. The lessons learned from the U.S. market can be applied to European markets, where similar challenges will arise, particularly around automation, infrastructure, and client education.

For FinTech recruitment professionals, these changes present an exciting opportunity to place highly skilled individuals who understand the complexities of global financial markets. As companies prepare for the global implementation of T+1, the demand for professionals with expertise in market infrastructure, trade settlement, and automation will only grow. Professionals who can navigate these changes and contribute to the success of such transitions will be in high demand, making it essential for recruitment firms to stay ahead of these trends and understand the shifting needs of their clients.

Automating the Future: The Importance of Technology in Financial Markets

The conversation also delves into the role of automation in the future of financial markets. David explains that, while automation was crucial to the success of the T+1 transition in the U.S., it will be even more vital as the process scales globally. Automation allows for faster and more efficient trade processing, which is essential for markets that are operating in real-time.

As financial markets move toward more streamlined operations, technology will continue to play a pivotal role in driving efficiency. David talks about the need for operational systems that can support global trade processing, and the role of companies like DTCC in building these systems. DTCC’s central trade manager (CTM) platform, for example, helps reduce friction in the trade lifecycle by providing automated solutions for reference data, matching, and settlement instructions. By automating these processes, the financial markets can reduce delays, improve accuracy, and increase transparency.

The role of automation is particularly relevant for recruitment professionals working in FinTech. As financial institutions invest more in technology to improve market efficiency, the demand for technology specialists, particularly those with expertise in automation, will rise. Recruitment firms like us, Harrington Starr, which specialize in placing top-tier talent in the FinTech sector, are well-positioned to meet this growing need by connecting clients with candidates who have the technical expertise to support automation initiatives and drive operational efficiency in the financial services industry.

The Globalization of Financial Markets and the Role of Collaboration

One of the key takeaways from the conversation is the importance of collaboration in driving global market efficiency. As David discusses, DTCC is already collaborating with Central Securities Depositories (CSDs) around the world to replicate the U.S. model of trade processing and create a more integrated global market. By working together, financial institutions, regulators, and technology providers can drive innovation, remove friction from the trading process, and create a more efficient global marketplace.

The financial services industry is becoming increasingly global, and the need for professionals who can navigate international markets and understand the nuances of global trade processing is growing. As financial markets continue to evolve, the role of global collaboration will become even more significant. Professionals who can bridge the gap between markets, understand international regulatory requirements, and implement innovative solutions will be highly sought after in the coming years.

As a leading FinTech recruitment firm, Harrington Starr is uniquely positioned to help clients find the talent they need to succeed in this globalized financial market. Understanding the challenges and opportunities presented by global market integration allows us to connect our clients with candidates who have the skills and experience necessary to thrive in an increasingly interconnected world.

Financial Market Infrastructure in 2025 and Beyond

David concludes the episode by discussing the future of financial market infrastructure and the ongoing work that DTCC is doing to ensure that the transition to T+1 is successful on a global scale. He emphasizes that lessons learned in the U.S. market are already being shared with regulators and industry leaders in Europe and beyond. By continuing to collaborate with stakeholders around the world, DTCC aims to create a more seamless and efficient global market that benefits investors, firms, and market participants everywhere.

At Harrington Starr, we see this ongoing evolution in financial market infrastructure as an exciting opportunity to place top talent across a range of roles. As the demand for automation, operational efficiency, and market expertise continues to grow, we’re ready to connect businesses with professionals who can help shape the future of global financial markets.