The Reserve Bank of India on Friday mandated the reporting of transactions in gold derivatives undertaken by banks and their customers domestically and abroad, starting February next year.
Banks must report all over-the-counter deals in gold derivatives undertaken by them and by their eligible customers or constituents in domestic markets, International Financial Services Centre and outside India to the trade repository of Clearing Corporation of India Ltd. with effect from Feb. 1, 2025, the central bank said is a circular.
The banks will have to report all such transactions to CCIL before 12:00 noon of the following business day. Furthermore, banks have to report all amendments and unwinding of the transactions undertaken in accordance with regulations to the trade repository.
The reporting formats will be as indicated by CCIL with the prior approval of the RBI, the circular said.
The RBI, as a one-time measure, has given banks a window till Feb. 28 to report all matured and outstanding OTC transactions in gold derivatives from Apr. 15, 2024.
The banks have to submit a quarterly report on transactions in gold derivative at exchanges in IFSC and overseas to the RBI within ten days of the succeeding quarter, commencing from the quarter ending Dec, 31, 2024.
Commodity derivatives product like those for gold provide an effective hedging tool much to the advantage of market participants. In India, gold futures are available for trading in four different variants such as gold regular, gold mini, gold guinea and gold petal.
Gold derivatives are traded on the NSE, MCX and at IFSC in GIFT City in Gujarat.
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