Settlement instruction matching is the process in which a central securities depository or settlement agent compares the delivery instruction sent by the seller's side with the receipt instruction sent by the buyer's side and confirms that they describe the same transaction. Only matched instructions can go forward to settlement. The fields compared usually include the security, quantity, cash amount and currency, trade date, intended settlement date and the parties and accounts on each side.
Matching happens after trade matching between the trading parties and uses each side's securities settlement instruction. If only one instruction has arrived, the counterparty is sent an allegement telling it that a trade is being claimed against it. Instructions that differ are reported as unmatched and must be corrected, a task described under fails repair. Small cash differences are accepted within a tolerance. Early matching is one of the preventive measures in the EU settlement discipline regime.