Ndf: RBI's wider NDF access may require foreign exposure proof: Bankers - Times of India
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MUMBAI: Indian residents will likely need to provide proof of exposure to foreign exchange risks to take advantage of the Reserve Bank of India 's opening up of the non-deliverable forward market ( NDF ), bankers said. The Reserve Bank of India, while announcing its last policy decision, said it will permit banks with IFSC banking units to offer non-deliverable forex derivative contracts involving the Indian rupee to local residents. An IFSC Banking Unit or "IBU" is a bank permitted by the Reserve Bank of India to operate from an International Financial Services Centre (IFSC). Previously, IFSC banking units were permitted to transact in rupee NDF forex derivatives contracts only with non-residents and with other eligible banks. A non-deliverable forward is a contract that is settled without delivery of the rupee. The RBI will set out guidelines for the new NDF framework, clarifying whether residents have to provide proof of exposure to foreign exchange. ...