RBI Rejects Offshore Bond Settlement
Analysis based on 7 articles · First reported Jun 17, 2026 · Last updated Jun 18, 2026
The State Bank of India's decision to keep government securities settlement domestic on the NDS-OM platform, rather than using offshore systems like Euroclear, aims to consolidate liquidity and improve price discovery. This move, despite recent tax incentives for foreign investors, could influence how foreign capital accesses India's bond markets, potentially favoring platforms like MarketAxess and Bloomberg News that integrate with NDS-OM.
The State Bank of India (RBI) has decided against enabling direct settlement of Indian government securities through offshore platforms such as Euroclear. This decision comes despite recent tax changes by India aimed at attracting foreign investors to its bond markets. The State Bank of India prefers overseas investors to participate directly on the domestic Negotiated Dealing System-Order Matching (NDS-OM) platform to maintain liquidity and enhance price discovery. While the State Bank of India had previously considered offshore settlement, it now prioritizes local clearing. Companies like MarketAxess and Bloomberg News are developing platforms linked to NDS-OM to facilitate foreign investor access. Since India removed capital gains taxes on foreign investment in government securities on June 5, the country has seen a significant increase in foreign inflows.
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