What changed
- RBI has issued a new instruction allowing AD banks to permit investment of surplus balances in Special Rupee Vostro Accounts in non-convertible debentures/bonds and commercial papers issued by Indian companies.
- This instruction is applicable with immediate effect.
- AD banks are required to bring the contents of this circular to the notice of their constituents and customers concerned.
What it means for you
- This change allows AD banks to offer their customers a wider range of investment options for their surplus balances in Special Rupee Vostro Accounts.
- It also provides an opportunity for Indian companies to raise funds through the issue of non-convertible debentures/bonds and commercial papers.
What you must do
- AD banks must permit investment of surplus balances in Special Rupee Vostro Accounts in non-convertible debentures/bonds and commercial papers issued by Indian companies.
- AD banks must bring the contents of this circular to the notice of their constituents and customers concerned.
Who it affects
AD banks, Their constituents and customers, Indian companies issuing non-convertible debentures/bonds and commercial papers
What is the purpose of this circular?
The purpose of this circular is to allow AD banks to permit investment of surplus balances in Special Rupee Vostro Accounts in non-convertible debentures/bonds and commercial papers issued by Indian companies.
What is the effective date of this instruction?
This instruction is applicable with immediate effect.
What are the implications of this circular for AD banks?
AD banks must bring the contents of this circular to the notice of their constituents and customers concerned.