Mumbai:
The Reserve Bank of India (RBI) has banned all transactions
in physical form with brokers. This ban is imposed on
all RBI-regulated entities with immediate effect.
In a circular, the RBI
said: No further transactions by a regulated entity should
be undertaken in physical form with any broker with immediate
effect.
The entities regulated by
the RBI, which includes financial institutions, primary dealers,
cooperative banks, RRBs, local area banks, non-banking financial
companies, should necessarily hold their investments in government
securities either in SGL or CSGL and SCHIL or in a dematerialised
account with depositories, the circular stated.
In the light of recent
fraudulent transactions in the guise of government securities
transactions in physical format by a few cooperative banks with
the help of some broker entities, it has been
decided to accelerate measures under contemplation for further
reducing the scope of trading in physical form, the central bank
said.
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