Squad Battles is a single player mode within FIFA 23 Ultimate Team mode. In Squad Battles, you play against Ultimate Team squads of other human players, but they are AI controlled at a difficulty level of your choice. The higher the difficulty, the more points you earn, and the more points you earn, the higher your ranking will be at the end of the week, and the ranking is what determines your rewards at the end of the week.
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How to change the time of Squad Battles in FIFA 23
During the FIFA 23 beta in August 2022, the duration of each Squad Battles match was fixed at 3 minutes per half, and many players were very happy with this, because it meant that Squad Battles was an easy and very easy game. Quick way to earn coins and other rewards in Ultimate Team. So many players assumed that this would be a permanent change that would also apply to the full release of FIFA 23. But it is not.

You cannot change the average length of Squad Battles or any type of Ultimate Team match. If you change the average duration to 3 minutes in the main game settings, this only applies to matches played outside of Ultimate Team. The average length of all Squad Battles games is 6 minutes.
Why can’t you change half the length in Ultimate Team?

Ultimate Team is a complex game mode with a complex economy. The pacing of rewards needs to be very well balanced in Ultimate Team, especially as some players pay real money to speed up their progress. So EA Sports can’t afford to risk upsetting that balance by making the mode too customizable.
The average length of Squad Battles was presumably set to 3 minutes during the beta because the beta only ran for a limited time and EA Sports wanted players to progress faster during that time so they could collect more meaningful data.