QUICK DEFINITION
Settlement Risk — The risk that one side of a transaction delivers value while the other side does not complete its obligation as expected.
WHY IT MATTERS
Why Settlement Risk matters in finance
It connects operational failure directly to liquidity and counterparty risk.
FINANCIAL SYSTEM CONTEXT
← Back to the Financial Security GlossarySecurity is also a market-infrastructure question
In financial services, settlement risk should be understood in relation to operational continuity, data integrity, payments, market infrastructure and interconnected dependencies. A control can be technically effective while still leaving material resilience risk if critical services cannot continue or recover during disruption.