Brokers seek clarity from RBI on g-sec trading rules

A group of stock brokers is asking the Reserve Bank of India (RBI) for more information about trading government securities. This follows the RBI's recent announcement that non-bank brokers can use the Negotiated Dealing System-Order Matching (NDS-OM) platform. The goal is to encourage more retail investors to participate in government securities trading. Brokers are seeking details about the procedures, operations, and fees involved in this new system. They are unclear on several points, such as whether investors will need separate accounts and how to use client codes. A fixed income executive noted that these details are crucial for proper implementation. Currently, brokers face challenges because their support systems are not integrated with the NDS-OM platform. They highlight that this integration will incur additional costs. The RBI hopes to attract retail investors by promoting a mobile app and reducing the minimum investment to ₹10,000. Despite these efforts, brokers report low retail interest in government securities. Many potential investors do not understand how government securities work. An education campaign is needed to help raise awareness. Retail investors often prefer options like fixed deposits, which they find familiar and easier to understand.