Laws and sections by number or title, due dates, pages, and updates.
Eligible entities must follow the Reserve Bank of India Master Direction for issuing commercial papers and non-convertible debentures with an initial maturity of up to one year. The directions apply to all persons and agencies dealing in commercial papers and non-convertible debentures. Issuers must ensure all fund-based facilities from financial institutions remain classified as standard at the time of issue. Participants must complete primary issuances and secondary market settlements through specified platforms and report transactions within designated time frames. These directions take effect on April 01, 2024, and supersede previous instructions on these money market instruments.
What you must do
Key dates
Law this touches
Who is affected
Thresholds
Exceptions
If you do not comply
Ask about this master direction
RBI/FMRD/2023-24/109 FMRD.DIRD.09/14.02.001/2023-24 January 03, 2024 To All Eligible Market Participants Madam/Sir Master Direction – Reserve Bank of India (Commercial Paper and Non-Convertible Debentures of original or initial maturity upto one year) Directions, 2024 Please refer to paragraph 6 of the Statement on Developmental and Regulatory Policies , announced as a part of the second Bi-monthly Monetary Policy Statement for 2019-20 dated June 06, 2019 regarding Comprehensive Review of Money Market Directions. Accordingly, the draft Directions on Call, Notice and Term Money, Certificate of Deposit and the Commercial Paper and Non-Convertible Debentures of original or initial maturity upto one year markets were released for market feedback on December 04, 2020 . The Master Direction - Reserve Bank of India (Call, Notice and Term Money Markets) Directions, 2021 and the Master Direction – Reserve Bank of India (Certificate of Deposit) Directions, 2021 were issued on April 01, 2021 and June 04, 2021 respectively.
The Directions on Commercial Paper and Non-Convertible Debentures of original or initial maturity upto one year have been reviewed based on market feedback and the Master Direction - Reserve Bank of India (Commercial Paper and Non-Convertible Debentures of original or initial maturity upto one year) Directions, 2024 are being issued herewith.
These Directions have been issued in exercise of the powers conferred under section 45J, 45K, 45L and 45W of the Reserve Bank of India Act, 1934 read with section 45U of the Act and of all the powers enabling it in this behalf.
Yours faithfully,
(Dimple Bhandia) Chief General Manager
FINANCIAL MARKETS REGULATION DEPARTMENT
Notification No. FMRD.DIRD.10/14.02.001/2023-24 dated January 03, 2024
Master Direction - Reserve Bank of India (Commercial Paper and Non-Convertible Debentures of original or initial maturity upto one year) Directions, 2024
In exercise of the powers conferred under section 45J, 45K, 45L and section 45W of the Reserve Bank of India Act, 1934 (hereinafter called the Act) read with section 45U of the Act and in supersession of Notification No. FMD.MSRG.49/02.13.016/2010-2011 dated July 28, 2010 , Section IV of FMRD. Master Direction No. 2/2016-17 dated July 07, 2016 and Direction No. FMRD.DIRD.01/CGM (TRS) – 2017 dated August 10, 2017 , the Reserve Bank of India (hereinafter called the Reserve Bank) hereby issues the following Directions.
These Directions shall be applicable to all persons/agencies dealing in Commercial Paper and/or Non-Convertible Debentures of original or initial maturity upto one year.
These Directions shall come into force with effect from April 01, 2024.
All India Financial Institution (AIFI) shall include: (a) Export Import Bank of India, (b) National Bank for Agriculture and Rural Development, (c) National Housing Bank, (d) Small Industries Development Bank of India and (e) National Bank for Financing Infrastructure and Development.
Bank means a banking company (including a Payment Bank and a Small Finance Bank) as defined in clause (c) of Section 5 of the Banking Regulation Act, 1949 (10 of 1949) or a “regional rural bank”, a “corresponding new bank” or “State Bank of India” as defined in clauses (ja), (da) and (nc), of section 5 respectively thereof, or a “cooperative bank” as defined in clause (cci) of Section 5 read with Section 56 of the said Act.
Body corporate means any entity incorporated by or under any Statute for the time being in force but does not include a co-operative society registered under any law relating to co-operative societies.
Commercial Paper (CP) means an unsecured money market instrument issued in the form of a promissory note.
Company means a company as defined in Section 2 (20) of the Companies Act, 2013 (18 of 2013).
Co-operative society shall have the meaning as assigned to it under clause (cciia) of Section 5 of the Banking Regulation Act, 1949 read with Section 56 of the said Act.
Delivery versus Payment (DvP) means a settlement mechanism which stipulates that transfer of funds from the buyer of securities is made simultaneously with the transfer of securities by the seller of securities.
Depository shall have the meaning as assigned in Section 2 (e) of the Depositories Act, 1996 (22 of 1996).
Debenture Trustee means an entity registered with SEBI as debenture trustee under the SEBI (Debenture Trustees) Regulations, 1993.
Electronic Trading Platform (ETP) shall have the meaning as assigned in paragraph 2(1) (iii) of the Electronic Trading Platforms (Reserve Bank) Directions, 2018 dated October 05, 2018 or as modified from time to time.
Financial Benchmark Administrator (FBA) means a person who controls the creation, operation and administration of financial benchmark(s) authorized under the Reserve Bank of India (Financial Benchmark Administrators) Directions, 2023, dated December 28, 2023 , as amended from time to time.
Group entities means an arrangement involving two or more entities related to each other through any of the following relationships: (a) subsidiary – parent (defined in terms of Ind-AS 110/AS 21); (b) joint venture (defined in terms of Ind-AS 28/AS 27) ; (c) associate (defined in terms of Ind-AS 28/AS 23); (d) Promoter-promotee (as provided in the SEBI (Acquisition of Shares and Takeover) Regulations, 1997) for listed companies; (e) common brand name or (f) investment in equity shares of 20 per cent and above.
Infrastructure Investment Trust (InvIT) means a business trust as defined in sub-clause (i) of clause 13A of section 2 of the Income-tax Act, 1961.
Issuing and Paying Agent (IPA) means a Scheduled Commercial Bank undertaking duties and responsibilities specified under paragraph 7(a) of these Directions.
Limited liability partnership shall have the meaning as assigned in Section 2(n) of the Limited Liability Partnership Act, 2008 (6 of 2009).
Money market instruments shall have the meaning as assigned in Section 45(U) (b) of the Reserve Bank of India Act, 1934.
Non-Banking Financial Company (NBFC) means a company as defined in Section 45 I (f) of the Reserve Bank of India Act, 1934.
Non-Convertible Debenture (NCD) means a secured money market instrument with an original or initial maturity upto one year.
A Non-resident shall mean a ‘person resident outside India’ and shall have the meaning as assigned to it in section 2 (w) of Foreign Exchange Management Act, 1999 (42 of 1999).
Over-the-Counter (OTC) markets refers to markets where transactions are undertaken in any manner other than on recognised stock exchanges and shall include those undertaken on electronic trading platforms (ETPs).
A Promoter shall have the meaning as assigned in Section 2(69) of the Companies Act, 2013.
Real Estate Investment Trust (REIT) means a business trust as defined in sub-clause (ii) of clause 13A of section 2 of the Income-tax Act, 1961.
Recognised stock exchanges shall have the meaning as assigned in Section 2 (f) of the Securities Contracts Regulation Act, 1956 (42 of 1956).
Related parties shall have the same meaning as assigned to it under Indian Accounting Standard (Ind AS) 24 – Related Party Disclosures or International Accounting Standard (IAS) 24 – Related Party Disclosures or any other equivalent accounting standards.
Resident shall mean a ‘Person resident in India’ and shall have the same meaning as assigned to it in Section 2 (v) of the Foreign Exchange Management Act, 1999 (42 of 1999).
