FPI boost: Banks to provide them margin for G-Sec purchase
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The Reserve Bank of India (RBI) has allowed authorised dealer banks to provide margin money facility to Foreign Portfolio Investors (FPI) for their transactions in Government Securities (G-Sec).
The move is aimed at encouraging investments by FPIs in the Indian debt market.
Announcing the measure, RBI Governor Shaktikanta Das said that the provision would ease operational constraints faced by FPIs and promote ease of doing business.
As per RBI's decision, authorised dealer banks will now be able to place margins on behalf of their FPI clients for their transactions in Government Securities, including State Development Loans and Treasury Bills.
This will be permitted within the credit risk management framework of banks, Das said.
