The Reserve Bank of India (RBI) on December 08, 2025, issued the Master Direction – Reserve Bank of India (Rupee Interest Rate Derivatives) Directions, 2025.
The following has been stated namely: -
• These Directions shall be applicable from March 01, 2026.
• The Master Direction establishes a comprehensive regulatory framework governing INR interest rate derivative transactions across OTC and exchange-traded markets.
• It defines eligible participants, classifies users into retail and non-retail categories, and specifies permitted derivative products such as swaps, futures, options, caps, and collars based on risk exposure and user type.
• The framework permits participation by residents and non-residents, with restrictions on hedging purpose, exposure limits, and benchmark usage, including special provisions for Foreign Currency-Settled IRDs.
• Market-makers such as scheduled banks, SPDs, and specified NBFCs must comply with risk management, reporting obligations to CCIL’s trade repository, and prudential norms issued by respective regulators.
• The directions supersede earlier circulars and mandate regulatory reporting, audit compliance, and penal actions for violations, ensuring transparency and systemic integrity in derivative markets.
[Notification no. - RBI/FMRD/2025-26/380 FMRD.DIRD.No.06/14.03.046/2025-26]
