Build infrastructure for rupee trades beyond USD-INR pair: RBI Governor Malhotra urges CCIL

MUMBAI: Reserve Bank of India (RBI) Governor Sanjay Malhotra on Friday said the Clearing Corporation of India Ltd (CCIL) should prepare for the next phase of financial market development by facilitating currency trading beyond the dollar-rupee pair, as part of the broader goal of internationalising the Indian rupee.

“As the market evolves, CCIL must keep abreast with its offerings and products for example, given the broader objective of internationalization of INR, CCIL could explore the possibility of putting in place necessary infrastructure to facilitate trading and settlement services for currency pairs beyond the USD-INR,” Malhotra said at CCIL’s 25th anniversary celebrations.

The Governor said CCIL must keep pace with global developments and “take a lead in offering such products and facilities to the domestic markets.”

He urged the institution to remain ahead of the curve by leveraging technology and expanding its role in risk management.

“In short, CCIL will have to keep pushing at the frontiers of technology, be ahead of others, and provide world-class experience and world-class facilities, world-class risk management, and improve upon the trust which they have already built for themselves,” Malhotra noted.

Highlighting the expansion of CCIL’s trade repository, which now includes offshore banks and related entities of Indian market makers, Malhotra said the data collected has been critical for regulatory decision-making and surveillance. He stressed the need to strengthen the repository by automating reporting, validations, anomaly detection, and compliance checks.

On liquidity, he said, “Expanding the reach of platforms to wider market participants such as corporates, non-resident investors, etc. would enhance the available market liquidity while also adding to overall efficiencies.”

Malhotra commended CCIL for entering GIFT City and urged it to continuously improve its product suite, including interest rate derivatives, forex retail, and RBI Retail Direct.

Applauding its journey with the RBI in shaping India’s financial market infrastructure, he remarked, “It should not be an exaggeration to state that it is a risk management company and a tech company rolled into one.” (ANI)