The Reserve Bank of India released new Master Directions on Credit Derivatives. These directives aim to introduce derivatives on credit indices and total return swaps to enhance the credit derivatives market framework.
RBI Releases New Master Direction on Credit Derivatives
On June 25, 2026, the Reserve Bank of India (RBI) issued the 'Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2026'. These directives respond to a policy statement made earlier this year, aimed at advancing the regulatory framework governing credit derivatives.
The new directions introduce provisions concerning derivatives on credit indices and total return swaps, marking a significant development in the RBI's capital market engagement. The directions are key to improving market liquidity and protecting participants from credit risk.
Practitioners in the financial and regulatory sectors should note the implications of this new framework, which may lead to expanded trading opportunities and a more robust risk management landscape in India's credit derivatives market.
Citations
- RBI Master Direction (2026) Volume 1 Page 1
