The Reserve Bank of India (RBI) has issued an updated directive on the reporting of foreign exchange (FX) transactions to the Trade Repository (TR) managed by the Clearing Corporation of India Ltd. (CCIL). As per the RBI’s Master Direction on Risk Management and Inter-Bank Dealings, originally issued on July 5, 2016, Authorised Dealers (ADs) are required to report all over-the-counter (OTC) FX derivative and foreign currency interest rate derivative contracts. This applies to transactions executed directly or through ADs’ overseas entities, such as overseas branches, International Financial Services Centres (IFSC) Banking Units, wholly owned subsidiaries, and joint ventures.
To improve the completeness of data in the TR, the RBI has expanded the reporting scope to include foreign exchange spot transactions, namely FX cash, FX tom, and FX spot deals. This broader scope now mandates ADs to report these contracts, whether involving the Indian Rupee (INR) or other currencies. However, it’s essential to note that money-changing transactions are excluded from these requirements and remain governed by a separate set of regulations.
Starting from February 10, 2025, all inter-bank FX contracts involving INR must be reported in hourly batches within 30 minutes after the end of each hour. Contracts executed within the last hour of the CCIL’s daily reporting platform closure should be reported by 10 a.m. on the following business day. For contracts that do not involve INR, those completed by 5 p.m. must be reported by 5:30 p.m., while those executed after 5 p.m. should also be reported by 10 a.m. the next day.
Further, a phased reporting requirement applies to FX contracts between ADs and their clients. Effective May 12, 2025, FX contracts with values exceeding USD 1 million (or equivalent in other currencies) must be reported, followed by a lower threshold of USD 50,000 from November 10, 2025. All client contracts need to be reported by noon on the following business day.
A critical point of these directions is that there is no need to match transactions with overseas counterparties or clients in the TR, as they are not obligated to confirm or report transaction details. Instead, ADs bear the responsibility of ensuring data accuracy and reconciling balances with the TR. They must also conduct ongoing audits to verify records and follow the reporting format approved by the RBI and indicated by the CCIL.
These directions are under the RBI’s authority as per Section 45W of the RBI Act, 1934, and sections of the Foreign Exchange Management Act, 1999, ensuring a more comprehensive and transparent FX transaction reporting system.
