RBI Makes UTI Mandatory for OTC Derivative Transactions
Why in the news
The Reserve Bank now requires every over-the-counter derivative deal to carry a unique identifier, giving regulators a clearer view of this market.
Key facts
- Rule: the UTI is compulsory for all OTC derivative transactions.
- What it is: a globally recognised data element that identifies each trade uniquely.
- Use: accurate reporting and tracking of derivative trades.
Why it matters
- Gives policymakers and regulators a comprehensive, transparent picture of the OTC market.
- Improves risk monitoring, market surveillance, data consistency and oversight of financial stability.
About OTC derivatives
- Contracts negotiated privately and traded directly between two parties, outside a formal exchange.
Exam angle
- Full form: Unique Transaction Identifier.
- Mandating authority: RBI.
- OTC means traded outside an exchange.