Settlement Process for Spot Contracts
Settlement of Spot Contracts is designed to facilitate timely completion of obligations through periodic settlement cycles and predefined settlement windows.
The Spot settlement framework supports transfer of bullion ownership through Bullion Depository Receipts (BDRs) and settlement of financial obligations.
Bullion Depository Receipt (BDR) Settlement
For Spot Market contracts, transfer of Bullion Depository Receipts (BDRs) is processed through periodic settlement batches.
Settlement Frequency
BDR Settlement — Every 30 Minutes
Periodic settlement enables:
• Faster ownership transfer
• Improved operational efficiency
• Reduced settlement cycle dependency
• Enhanced market liquidity
Funds Settlement – T+0 Contracts
For T+0 Spot Contracts, financial obligations are settled through periodic fund settlement cycles.
Settlement Frequency
Funds Settlement — Every 3 Hours
This framework supports:
• Intraday settlement efficiency
• Improved liquidity utilization
• Timely completion of obligations
• Enhanced cash flow management
Settlement Cycle Options
T+0 Settlement : Trade execution and settlement obligations are completed on the trade date through periodic settlement cycles.
Key characteristics:
• Same-day settlement
• BDR settlement every 30 minutes
• Funds settlement every 3 hours
• Faster transfer of ownership
T+2 Settlement : Settlement obligations are completed within two business days from trade execution in accordance with applicable contract specifications.
Key characteristics:
• Deferred settlement cycle
• Operational flexibility
• Contract-based settlement timelines
Delivery Framework
Delivery arrangements support secure and efficient transfer of bullion ownership.
Settlement and delivery are completed in accordance with Exchange procedures and applicable contract specifications.
Delivery Centres
Settlement and delivery infrastructure currently supports:
• GIFT City
• Chennai
The delivery framework supports efficient bullion logistics and exchange-enabled settlement operations.
Settlement Process for Futures Contracts
Futures Contracts are settled in accordance with applicable contract specifications and may provide either financial settlement or physical delivery settlement.
The framework is designed to support orderly contract completion while integrating clearing, risk management and settlement controls.
Settlement Options
Cash Settlement : Under Cash Settlement, open positions are settled financially without transfer of underlying bullion.
Settlement obligations are determined using the prescribed settlement methodology and completed through financial settlement procedures.
Key characteristics:
• Financial settlement of obligations
• No physical delivery requirement
• Efficient contract closure
Delivery Settlement : Under Delivery Settlement, contracts are settled through transfer of underlying bullion in accordance with Exchange procedures and contract specifications.
IIBX follows a structured and market-driven delivery allocation mechanism.
IIBX Delivery Matching Framework
Delivery Through Intention and Premium / Discount Matching
For contracts eligible for delivery settlement, participants may indicate their intention to:
• Give Delivery
• Take Delivery
Physical settlement is facilitated through a two-stage matching process.
Stage 1 — Delivery Intention Matching
Participants expressing intention to deliver are matched with participants expressing intention to receive delivery.
Only successfully matched delivery intentions proceed for settlement allocation.
Stage 2 — Premium / Discount Matching
Matched participants indicate delivery preference through premium or discount quotations.
Premium Quote : Participant enters a positive premium value above the applicable contract benchmark.
Example: + USD X
Discount Quote : Participant enters a negative value indicating willingness to settle below the benchmark.
Example: − USD X
Delivery allocation is completed in accordance with applicable matching methodology and contract specifications.
Illustrative Delivery Outcome
| Participant | Delivery Intention | Premium / Discount Quote |
|---|---|---|
| Buyer A | Take Delivery | + USD 2 |
| Buyer B | Take Delivery | - USD 1 |
| Seller X | Give Delivery | + USD 2 |
| Seller Y | Give Delivery | - USD 1 |
Illustratively:
• Buyer A may match with Seller X
• Buyer B may match with Seller Y
subject to applicable Exchange rules and settlement procedures.
Innovative Delivery Discovery Framework
IIBX has introduced an innovative delivery settlement approach by combining:
• Delivery intention matching
• Market-driven premium / discount discovery
• Participant-led delivery allocation
This framework enables greater flexibility and supports efficient delivery outcomes for physically settled contracts.
The mechanism reflects IIBX’s focus on innovation in exchange-based bullion market infrastructure.