‘RBI Retail Direct’ scheme- Highlights
Reserve Bank of India (RBI) introduced “RBI Retail Direct facility” scheme on July 12, 2021.
What is Retail Direct Scheme?
- RBI’s Retail Direct Scheme is a one-stop solution to facilitate investment in Government Securities (G-Sec) by individual investors.
- Under this scheme, retail investors will be provided a facility to open and maintain Retail Direct Gilt Account (RDG Account) with RBI.
- This facility was launched as part of continuing efforts towards increasing retail participation in government securities.
- Announcement to launch this scheme was made by RBI in Statement of Developmental and Regulatory Policies of February 05, 2021.
- It was launched to improve ease of access by retail investors by online access to primary as well as secondary government securities market.
- Date of implementation of scheme is not yet announced.
Features of the scheme
- Under the scheme, Retail investors (individuals) will have the option to open & maintain ‘Retail Direct Gilt Account’ (RDG Account) with RBI.
- RDG Account can be opened using an ‘Online portal’ provided for the purpose of this scheme.
- Online portal will also provide facilities to registered users like access to primary issuance of Government securities & access to NDS-OM.
- No fee will be charged on opening and maintaining account with RBI.
What is G-secs?
G-secs are debt instruments issued by government to borrow money. These instruments are not tax-free. They are the safest form of investment because they are backed by government. Risk of default associated with g-secs is almost nil. They are however, subject to fluctuations in interest rates. It can be issued in-
- Short term- such a treasury bills for 91-days, 182-days and 364 days
- Long term- with bonds maturity of one year or more.
Month: Current Affairs - July, 2021
Category: Economy & Banking Current Affairs
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