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RBI Reviews Banks in Non-Agri Commodity Derivatives

8 December 20251 min read
BANKING & FINANCERBI Reviews Banksin Non-AgriCommodityDerivatives8 December 2025safalsetu.com

Why in the news

Governor Sanjay Malhotra said RBI was studying whether banks could enter non-agri commodity derivatives, which law currently forbids.

Key facts

  • Law in the way: Banking Regulation Act, which would need amendment.
  • RBI said wider effects need study beyond one regulatory tweak.
  • Sebi aims to admit banks, insurers and pension funds; government talks may follow.

About the contracts

  • Exchange-traded contracts priced off non-farm goods such as metals, energy and bullion.
  • Used to hedge, speculate or manage exposure.
  • Exchanges: MCX and ICEX.

Exam angle

  • Barring law: Banking Regulation Act. Proposer: Sebi.

Test yourself

1. Which law presently prohibits banks from trading in non-agricultural commodity derivatives?

RBI's Governor said the Banking Regulation Act prohibits banks from such activities.

2. Which body proposed letting banks participate in non-agri commodity derivatives?

The proposal came from Sebi and RBI was reviewing it.

3. Which of these is a commodity exchange named in the notes on non-agri derivatives?

MCX and ICEX were named as Indian commodity exchanges.

This topic is part of Daily Current Affairs 6 December 2025 (10 topics).

All topics of the dayDay quizDecember 2025

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