1. Introduction
The Reserve Bank of India (RBI) has issued the RBI (Unique Identifiers in Financial Markets) Directions, 2026, laying down a comprehensive framework for the use of unique identifiers in financial market transactions.
2. Coverage of the Directions
The Master Directions prescribe norms relating to:
- Scope and applicability of the Legal Entity Identifier (LEI)
- Framework for implementation of LEI
- Scope of the Unique Transaction Identifier (UTI)
- Framework for implementation of UTI
3. Legal Entity Identifier (LEI) – Key Aspects
The LEI is a 20-character unique identity code assigned to entities participating in financial transactions.
3.1 Mandatory Requirement
- All participants—resident and non-resident—falling within the scope must obtain an LEI
- LEI must be obtained from a Local Operating Unit (LOU) accredited by the Global Legal Entity Identifier Foundation (GLEIF)
3.2 Compliance Conditions
- Entities without an LEI are not permitted to undertake transactions in RBI-regulated financial markets
- The LEI must remain active and up to date as per global LEI system rules
- Lapsed or inactive LEIs will render entities ineligible for transactions
4. Unique Transaction Identifier (UTI) – Key Aspects
The UTI is a unique identifier assigned to each OTC derivative transaction.
Applicability
- Mandatory for all transactions in the OTC derivatives market
- Must be generated and reported in accordance with the Governing Directions
5. Key Takeaway
These Directions strengthen transparency and traceability in financial markets by mandating standardised identifiers for both entities (LEI) and transactions (UTI), thereby enhancing regulatory oversight and systemic risk monitoring.
