Press Release: 2026-2027/541, Dated: 25.06.2026
The Reserve Bank of India (RBI) has released the Draft Master Direction on Secondary Market Transactions in Government Securities, 2026. The draft directions aim to provide a comprehensive regulatory framework for secondary-market transactions in Government Securities.
RBI has invited comments and suggestions from banks, market participants, investors and other interested persons on the proposed framework.
1. Comments Invited from Stakeholders
RBI has sought feedback on the draft Master Direction from:
- Banks;
- Market participants;
- Investors; and
- Other interested stakeholders.
Comments and suggestions may be submitted by July 17, 2026.
2. Coverage of Eligible Participants
The draft directions prescribe the categories of participants eligible to undertake secondary market transactions in Government Securities.
This is intended to clarify the entities that may participate in the market and the conditions applicable to such participation.
3. Transactions in the OTC Market
The draft framework covers transactions carried out in the Over-the-Counter (OTC) market.
It seeks to regulate the manner in which Government Securities may be traded bilaterally between eligible participants outside recognised exchange platforms.
4. Transactions on Recognised Stock Exchanges
The directions also cover transactions in Government Securities undertaken on recognised stock exchanges.
This is expected to support transparent and regulated trading of Government Securities through exchange-based platforms.
5. Eligible Government Securities
The draft Master Direction specifies the Government Securities that may be eligible for secondary market transactions under the framework.
This will help ensure uniformity in the treatment of instruments permitted for trading.
6. Code of Conduct for Market Participants
The draft directions include a code of conduct for participants dealing in Government Securities.
The code is aimed at promoting fair dealing, transparency, market integrity and responsible conduct among participants.
7. Settlement and Reporting Norms
The framework also covers requirements relating to:
- Settlement of transactions;
- Reporting of trades;
- Compliance with prescribed timelines; and
- Maintenance of market discipline.
These norms are intended to improve transparency and ensure orderly functioning of the secondary market.
8. Objective of the Draft Directions
The draft Master Direction seeks to:
- Consolidate the regulatory framework for secondary market transactions in Government Securities;
- Provide clarity on eligible participants and instruments;
- Regulate OTC and exchange-based transactions;
- Strengthen settlement and reporting discipline;
- Promote transparency and market integrity; and
- Support the orderly development of the Government Securities market.
9. Key Takeaway
RBI has released the Draft Master Direction on Secondary Market Transactions in Government Securities, 2026 and invited stakeholder comments by July 17, 2026. The draft covers eligible participants, OTC market transactions, recognised stock exchange transactions, eligible Government Securities, code of conduct, settlement norms and reporting requirements.
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