The Reserve Bank of India (RBI) on February 06, 2026, issued Draft updates in the Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2022.
The following has been stated: -
•RBI Directions regulate credit derivatives (CDS and TRS) in OTC markets and exchanges, defining key terms, participants, and settlement mechanisms.
•Eligible participants include residents and certain non-residents, with market-makers such as scheduled commercial banks and approved NBFCs; users are classified as retail and non-retail.
•Retail users may buy CDS only for hedging, while non-retail users have broader participation; specific entities like insurers, pension funds, mutual funds, and FPIs can act as protection sellers.
•Eligible reference assets include money market instruments and INR corporate bonds/debentures, with restrictions on structured products and related-party transactions.
•Directions prescribe operational rules on settlement, reporting to CCIL, customer protection, standardisation and a Credit Derivatives Determinations Committee for resolving events and settlement procedures.
•Comments on the draft revised Directions are invited from market participants, stakeholders and other interested parties by February 27, 2026.
These Directions shall come into force on May 09, 2022.
URL: https://website.rbi.org.in/web/rbi/-/press-releases/rbi-releases-draft-revised-master-direction-reserve-bank-of-india-credit-derivatives-directions-2022
The detailed notification is given in the document below.
