India's new lending curbs seen squeezing trading firms - Reuters

<a href="https://news.google.com/rss/articles/CBMiyAFBVV95cUxQbThqVGFqUW9Xb3YxbWhQa29PRXcwTlh6dG9TZVVwTWUyMDY4b1Y5YnpuX1hvRXloYWxiZHgycmt3aDRfTnVGOWhPYy0waVg1OXl2ZUFwd2x5anhvM21aSXpaYmdSd2lpTnZneGZfYTVOUUFGbkNWYlNSWktrcVdOdXBLVlNvZEhmRDNpWl9IUngzM215a1BrUW1IUFFleVhEck5rcGVBenl4NTNCNGJtUkFvR2cwRllPZW5saTZMOXFqUW9YZlRCUA?oc=5" target="_blank">India's new lending curbs seen squeezing trading firms</a>&nbsp;&nbsp;<font color="#6f6f6f">Reuters</font>

The Reserve Bank of India's new rules, effective April 1, prohibit banks from lending for proprietary trading and require 100% collateral for other broker funding, potentially halving profit margins and reducing derivative trading volumes by up to 20%.

Starting April 2026, the Reserve Bank of India will ban banks from giving loans to proprietary trading firms, targeting risky levels of borrowing in India's booming derivatives market, which makes up a huge chunk of all trades on the National Stock Exchange.

The Reserve Bank of India's new rules, effective April 1, prohibit banks from lending for proprietary trading and require 100% collateral for other broker funding, potentially halving profit margins and reducing derivative trading volumes by up to 20%.

The Association of NSE Members of India (ANMI) has formally petitioned the Securities and Exchange Board of India (Sebi) to delay the implementation of the Reserve Bank of India's new 100% cash collateral rule on bank guarantees by six months, expressing concerns over its potential impact on proprietary trading and market liquidity.

The Reserve Bank of India's recent amendments to credit facilities regulations, effective April 1, 2026, introduce significant changes, including a prohibition on bank funding for proprietary trading, mandatory 100% collateralization of all credit facilities to capital market intermediaries, and a minimum 40% haircut on equity collateral, fundamentally altering the economics of trading and brokerage in India.

The Reserve Bank of India's new rules, effective April 1, prohibit banks from lending for proprietary trading and require 100% collateral for other broker funding, potentially halving profit margins and reducing derivative trading volumes by up to 20%.