RBI Draft Directions on Reporting of OTC FX Derivatives by AD Banks

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  • Last Updated on 20 February, 2026

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RBI OTC derivatives

Press Release No. 2025-2026/2124; dated: 16.02.2026

The Reserve Bank of India (RBI) has released draft directions on reporting instructions for Authorised Dealer Category-I (AD Cat-I) banks, proposing a comprehensive reporting framework for Over-the-Counter (OTC) foreign exchange derivatives involving INR.

The draft aims to enhance transparency and strengthen monitoring of offshore and global derivative transactions linked to Indian markets.

1. Reporting of OTC Forex Derivatives to Trade Repository

Under the proposed framework:

  • AD Category-I banks must report details of OTC foreign exchange derivative contracts involving INR
  • Entered into by their offshore-related parties
  • To the Trade Repository (TR) of the Clearing Corporation of India Ltd (CCIL)

This reporting requirement applies to transactions undertaken globally by related parties of AD Cat-I banks.

2. Scope of Transactions Covered

The draft directions specify that:

  • All OTC foreign exchange derivative contracts involving INR, undertaken globally by related parties of AD Cat-I banks
  • Must be reported to the Trade Repository

2.1 Definition of OTC Derivatives

For the purpose of these directions:

  • OTC derivatives refer to derivatives not traded on stock exchanges
  • This includes derivatives traded on electronic trading platforms (ETPs)

3. Reporting Requirements and Data Elements

AD Cat-I banks are required to:

  • Report all elements of covered transactions
  • Provide meaningful and complete information regarding:
    1. Transaction structure
    2. Counterparty details
    3. Pricing and settlement parameters
    4. Risk exposure

The objective is to enable comprehensive regulatory oversight.

4. Reporting of Counterparty Details

The draft clarifies that:

  • A central counterparty (CCP) may be reported as the counterparty
  • Only where the transaction:
    1. Is executed on an anonymous trading platform, and
    2. Cleared through the central counterparty

This ensures accurate representation of exposure in cleared trades.

5. Reporting Formats

  • Reporting formats will be specified by CCIL
  • Such formats will require prior approval of RBI

This ensures standardised reporting across AD Category-I banks.

6. Regulatory Objective

The proposed directions aim to:

  • Enhance transparency in global INR-linked derivative markets
  • Strengthen monitoring of offshore exposures
  • Improve data availability for risk assessment
  • Align reporting standards with evolving market practices

7. Key Takeaway

The RBI’s draft directions propose mandatory reporting by AD Category-I banks of all INR-linked OTC forex derivative transactions undertaken globally by their related parties, to CCIL’s Trade Repository, ensuring comprehensive regulatory oversight of offshore derivative exposures.

Click Here To Read The Full Press Release

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied