RBI Unveils Draft Regulations to Revamp Rupee Interest Rate Derivatives
The Reserve Bank of India has issued draft regulations to update the framework governing Rupee Interest Rate Derivatives. This move is aimed at aligning regulatory measures with evolving market dynamics, including new products and non-resident participation. Stakeholders can submit feedback by July 2025.
- Country:
- India
The Reserve Bank of India (RBI) on Monday introduced draft regulations targeting a revamp of the Rupee Interest Rate Derivatives (IRD) market. This initiative seeks to synchronize the existing regulatory framework with market changes and emerging trends.
The original guidelines were established in June 2019, but since then, the market has evolved with new products and increased non-resident participation. Consequently, a thorough review led to the creation of new draft directions known as the 'Draft Master Direction - Reserve Bank of India (Rupee Interest Rate Derivatives) Directions, 2025'.
The draft highlights that non-residents can engage in IRD transactions through their central treasury or group entities if applicable. It also intends to simplify reporting requirements to lessen compliance burdens while adding global reporting measures to enhance market transparency. The RBI invites comments from banks and interested parties by July 7, 2025.
(With inputs from agencies.)
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