NEW DELHI: In a major structural reform, the Reserve Bank of India (RBI) on Friday allowed retail investors to access to the government securities (G-sec) market.
Announcing the RBI's monetary policy review for the month of February, governor Shaktikanta Das said that the move will make India join a select group of country offering such facility to investors.
"As part of continuing efforts to increase retail participation in government securities and to improve ease of access, it has been decided to move beyond aggregator model and provide retail investors online access to the government securities market -- both primary and secondary -- along with the facility to open their gilt securities account
(‘Retail Direct’) with the RBI," Das said.
Retail Direct will allow direct access to retail investors via the RBI and they will be able to open their Gilt accounts.
The RBI governor said that the move will help in smooth completion of the government's borrowing target for 2021-22.
G-secs are one of the safest fixed income instruments available in India.
It is a tradeable instrument issued by the Central government or the state governments and acknowledges the government’s debt obligation.
Details of the Retail Direct facility will be issued by the RBI separately.