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Over The Counter Forex Trade Repository Launched By CCIL

The repository service for over-the-counter foreign exchange derivatives by CCIL is to be launched on Monday. The deputy governor of RBI, Dr Subir Gokarn said that the country is among the first to have this capacity. In order to ensure the national regulators have access to all relevant information, he said that the G-20 countries had committed to report all OTC derivatives contracts.

Clearing Corporation - CCIL Logo

Clearing Corporation – CCIL Logo

Most of these OTC derivatives are complex in structure which is why it poses systematic risk. Experts have observed that there is no transparency in this market segment which is why there are financial crisis experienced a few years ago. The purpose of a trade repository is to maintain centralized electronic database of transaction data.

The transaction data will introduce a clear picture when it comes to positions and exposures. If these data will all be clear, it will reduce risk and improve operational efficiency and cost for the market.

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