Context:
The Reserve Bank of India (RBI) released a new Master Direction on Electronic Trading Platforms (ETPs) on June 16, 2025, aimed at strengthening the regulatory framework for digital financial market infrastructure. This direction replaces the 2018 guidelines and takes immediate effect.
Definition of ETP
An Electronic Trading Platform (ETP) is defined as:
“Any electronic system (excluding recognised stock exchanges) where transactions in eligible financial instruments are contracted electronically.”
Eligible Instruments include:
- Securities (non-stock exchange)
- Money market instruments
- Foreign exchange instruments
- Derivatives
Scope and Applicability
Not applicable to:
- Scheduled Commercial Banks (including foreign bank branches in India)
- Standalone Primary Dealers
—where the bank/dealer is the sole quote/price provider and a party to all trades.
Key Regulatory Provisions
Eligibility to Operate an ETP
Entities must:
- Be incorporated in India
- Have a minimum net worth of â‚ą5 crore
- Maintain robust technological infrastructure that ensures:
- High reliability
- Availability
- Scalability
- Strong cybersecurity
Approval Process
- Applications must be submitted via the PRAVAAH portal of RBI.
- RBI has discretion to grant, reject, or cancel authorisations based on compliance and public interest considerations.
Operational and Compliance Requirements
Data Retention:
- Maintain detailed transaction records for a minimum of 10 years.
Reporting Obligations:
- Submit quarterly reports on the platform’s operations to RBI by the 15th day of the month following the reporting quarter.
Monitoring and Enforcement:
- RBI retains enforcement powers including:
- Inspections
- Penalties
- Licence revocation for non-compliance.
