Retail Investors (Individuals) in India can now directly invest in Government Securities (i.e. Treasury Bills, dated securities, Sovereign Gold Bonds, State Development Loans).
Retail investors can now register for a Retail Direct Gilt Account (RBI RDG Account) by registering under the special account. Thus, they can invest directly in G-Secs.
The Retail Direct Scheme is a comprehensive scheme which provides the following facilities to retail investors in the G-Sec market through an online portal:
In addition, these facility is available for free through the Dedicated Online Portal. However, investors may have to pay a Payment Gateway fee.
According to an RBI website, using the RDG account, a saver can buy from the primary market.
The same account will be valid for secondary market trading at NDS-OM (i.e. Negotiated Dealing System – Order Matching), as well as for placing bids in primary auctions.
Generally, NDS-OM means RBI’s screen based, anonymous electronic order matching system for trading in G-Secs in the secondary market.
Payment can be made through net banking or UPI. Funds will be blocked at the submission of the bid, and will be debited depending upon the allotment.
Let’s try and understand the Features of the RBI RDG Account.
|Eligibility||Retail investors, as defined under the scheme, can register under the Scheme and maintain a RDG Account, |
if they have the following:
1. Savings bank account(Rupee) maintained in India.
2. PAN issued by the Income Tax Department.
3. Valid email id.
4. Registered mobile number.
5. KYC (Know Your Customer) documents.
c. The RDG account can be opened singly or jointly with another retail investor who meets the eligibility criteria.
|NRI||NRIs can open this account provided they comply with the Foreign Exchange Management Act.|
|Account Services||1. Access to primary issuance of Government securities.|
2. Access to NDS-OM.
|Fee and Charges||No fee will be charged for opening and maintaining RBI RDG account.|
|Nomination facility||There can be a maximum of two nominees.|
|Transactions||Account holder(s) will have an online facility to gift G-Secs to other Retail Direct Investors.|
|Account Statement||Transaction history and balance position of securities holdings in the account can be obtained from the link provided. However, all transaction alerts will be provided via e-mail or SMS.|
The RDG Account can be opened through an ‘Online portal’ provided for the purpose of the scheme.
After registering on the online portal, investor(s) will need to authenticate individuality by using a One-Time Password (i.e. OTP) received on their registered mobile number or email address and both.
Using the online portal, account holder(s) can access the auctions and the NDS-OM platform, i.e. the RBI platform for buying and selling G-Secs, Bonds, etc. and other money market instruments in the secondary market.
However, the portal is yet to be launched. Once the scheme is launched, retail investors can buy and sell T-bills, G-Secs, SGBs and SDLs.
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