Retail Investors Can Now Buy/Sell G-Securities Directly Via RBI

In the RBIs bi-monthly monetary policy announcement made today, Governor Shakitkanta Das said retail investors will soon be able to buy and sell government securities directly. As per the announcement made, "Retail investors will be allowed to open gilt investment account directly with RBI- both primary and secondary. The account will be called RBI retail direct."

With this move retail investors will have direct access to the safest fixed income investment option in the country, safer than even bank fixed deposits as the former have sovereign guarantee. Deposits with banks are only insured up to the extent of Rs 5 lakh per depositor under the Deposit Insurance Credit Guarantee Scheme (DICGS). The move is likely to benefit pensioners on the lookout for a safe and secure investment option that can provide assured returns for the long term.

The governor added that only few of the nations provide such facilities of allowing retail investors to directly buy and sell government securities. The fine print of the scheme shall be announced separately, said Das.

Government Security (G-Sec) is a tradeable instrument issued by the Central Government or the State Governments. Such securities are of short tenure and are popularly called treasury bills, with original maturities of less than one year or long term called Government bonds or dated securities with an original maturity of one year or more.

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