More Stories

Informist, Monday, Sept. 22, 2025

--RBI: Standalone PDs can now offer rupee non-deliverable derivative contracts

NEW DELHI – The Reserve Bank of India has allowed standalone primary dealers to offer rupee non-deliverable derivative contracts, the regulator said in a notification Monday. "On a review, it has been decided that Standalone Primary Dealers (SPDs) authorised as Authorised Dealer Category–III (AD Cat-III), shall also be eligible to transact in NDDCs involving the Rupee," the RBI said in a notification. This amendment will be effective immediately, the central bank said.

In 2020, the RBI had allowed banks with IFSC banking units to foray into the offshore NDF rupee derivative market. Banks are allowed to participate through their branches in India, their foreign branches, or through their IFSC banking units. This move comes amidst the Indian authorities' push to further develop the rupee non-deliverable derivative market at the GIFT-City.

Non-deliverable derivative markets are offshore markets that enable trading of the non-convertible currency outside the influence of the domestic authorities. These contracts are settled in a convertible currency, usually US dollars, as the non-convertible currency cannot be delivered offshore. In October 2022, the RBI had allowed standalone primary dealers to offer all foreign exchange market-making facilities on par with Authorised Dealer Category-I entities, but they were not allowed to deal in the non-deliverable derivative market.

Primary dealers are non-banking financial companies and have Authorised Dealer Category-III licences from the RBI. They are market-makers in the fixed income market, for both government securities and corporate bonds. Their primary activity is gaining interest income on held securities and capital gains from trading fixed income and money market instruments, along with some fee income for underwriting auctions of government paper. In India, there are seven standalone primary dealers, along with 14 integrated primary dealers.  End

Reported by Priyasmita Dutta

Edited by Ashish Shirke

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.