Currently, the RBI allows small investors to buy government bonds via the Gobid platform on BSE and NSE, but it has not gained any traction.
While no country allows a direct retail participation as the RBI has promised now, Britain, Brazil and Hungary allow small investors to buy/sell through third-party controls.
This is the second major step that the RBI is taking to encourage retail investors to enter the gilt market after it had allowed entry through the stock exchanges a few years back but did not elicit the intended result.
Under the new plan, all an investor needs to do is to open a gilt securities account ('retail direct') with the RBI is all what it said, as details of the facility will be issued separately.
As part of continuing efforts to increase retail participation in government securities and to improve ease of access, it has been decided to move beyond aggregator model and provide retail investors online access to government securities market, both primary and secondary, along with the facility to open a gilt securities account (retail direct) with the RBI, Governor Shaktikanta Das said while announcing the monetary policy.
It can be noted RBI has been encouraging retail participation in the government securities market for long with several initiatives like introduction of non-competitive bidding in primary auctions, permitting stock exchanges to act as aggregators/facilitators for retail investors and allowing odd-lot segment in the NDS-OM (negotiated dealing system-order matching) secondary market, among others, in the past.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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