Home › Circulars › RBI/2012-13/365

Repo in Corporate Debt: Revised Haircuts & Eligible Securities

No longer current — replaced by Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2022

Source: Reserve Bank of India · RBI/2012-13/365 · issued 07 Jan 2013 · ~2 min read

Quick answerRBI has lowered minimum haircuts for repo in corporate debt securities and expanded eligible securities to include CPs, CDs, and short-term NCDs. Effective January 8, 2013, these changes aim to deepen the corporate bond market and improve liquidity.

What changed

RBI revised the minimum haircut for repo transactions in corporate debt securities: for AAA-rated securities from 10% to 7.5%, for AA+ from 12% to 8.5%, and for AA from 15% to 10%. Additionally, repo is now permitted on Commercial Papers, Certificates of Deposit, and Non-Convertible Debentures with original maturity of less than one year, without listing requirement but with applicable rating criteria.

What it means for you

Lower haircuts reduce the cost of funding for banks and market participants using corporate debt as collateral, potentially boosting repo activity and liquidity in the corporate bond market. The inclusion of short-term instruments like CPs and CDs broadens the collateral pool, offering more flexibility for liquidity management. Banks can now use these instruments more efficiently for short-term funding, but must ensure appropriate higher haircuts for longer-tenor repos or non-daily remargining.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Update internal systems and risk models to reflect the new minimum haircuts for AAA (7.5%), AA+ (8.5%), and AA (10%) for overnight or daily-remargined repos.
Review and expand eligible collateral lists to include CPs, CDs, and NCDs with original maturity under one year, ensuring rating requirements are met.
Train treasury and risk teams on the revised guidelines and ensure compliance with the effective date of January 8, 2013.
For longer-tenor repos or non-daily remargining, adopt higher haircuts as appropriate and document the rationale.

Who it affects

All market participants including banks, primary dealers, mutual funds, insurance companies, and corporates engaged in repo transactions, Treasury departments managing liquidity and collateral, Risk management teams setting haircut policies

❓ Common questions

Regulatory timeline

Stated effective date Effective January 8, 2013
Decoded by BankPulse 2026-06-18 16:42 IST
Superseded by — Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2022
Status change: superseded 03 Aug 2026, 04:00 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What are the new minimum haircuts for repo in corporate debt securities?

For overnight repos or those with daily remargining, the minimum haircut is 7.5% for AAA-rated, 8.5% for AA+, and 10% for AA-rated securities. For other tenors or remargining frequencies, participants must apply higher haircuts.

Which new instruments are now eligible for repo under these guidelines?

Commercial Papers (CPs), Certificates of Deposit (CDs), and Non-Convertible Debentures (NCDs) with original maturity of less than one year are now eligible, without listing requirement but subject to rating criteria.

When do these revised guidelines take effect?

The amendments are effective from January 8, 2013, as per the Repo in Corporate Debt Securities (Amendment) Directions, 2013.

📜 This document’s life story (1 recorded event, each backed by RBI’s own words)

Superseded by Master Direction – Reserve Bank of India (Credit Derivatives) Directions, 2022

📜 Read the original circular — full text as issued by RBI

Notifications - Reserve Bank of India Skip to main content Selected Selected Change Language हिंदी Search the Website Search Home About Us ▼ About Us Organisation & Functions ▶ Organisation Structure Departments Offices Training Establishment ▶ College of Agricultural Banking Reserve Bank Staff College College of Supervisors RBI's Functions and Working Governors Deputy Governors Executive Directors Communication Policy of RBI Sources of Information ▶ Annual Publications Half-yearly Publications Quarterly Publications Monthly Publications Weekly Publications Occasional Publications SDDS NSDP Data Releases Publications available on Subscription General Information RBI History Museum ▶ The RBI Museum RBI Monetary Museum Notification ▼ Notifications Master Directions Master Circulars Amendment Directions Draft Notifications/Guidelines ▶ Draft Notifications/Guidelines Draft Directions (RE-wise) Index To RBI Circulars Standalone Circulars Circulars Withdrawn Press Releases Speeches & Media Interactions ▼ Speeches Media Interactions Memorial Lectures Podcasts Publications ▼ Biennial Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Working Papers Legal Framework ▼ Act Rules Regulations Schemes Research ▼ External Research Schemes RBI Occasional Papers Working Papers RBI Bulletin History DRG Studies KLEMS State Statistics and Finances Statistics ▼ Data Releases Database on Indian Economy Public Debt Statistics Regulatory Reporting ▼ List of Returns Data Definition Validation rules/ Taxonomy List of RBI Reporting Portals FAQs of RBI Reporting Portals Home Notifications Notifications ( 43 kb ) Revised Guidelines on Ready Forward Contracts in Corporate Debt Securities This circular has been superseded by Repurchase Transactions (Repo) (Reserve Bank) Directions, 2018 dated July 24, 2018 . RBI/2012-13/365 IDMD.PCD.09/14.03.02/2012-13 January 7, 2013 To All Market Participants Dear Sir/Madam, Revised Guidelines on Ready Forward Contracts in Corporate Debt Securities As part of the measures to develop the corporate bond market, repo transactions were permitted in corporate debt securities vide the Directions issued through the notification no IDMD.DOD. 04/11.08.38/ 2009-10 dated January 8, 2010 as amended vide notification no. IDMD.PCD. 21/11.08.38/2010-11 dated November 9, 2010 . 2. Taking into consideration the market feedback and suggestions of the Technical Advisory Committee on Money, Foreign Exchange and Government Securities Markets, the Directions have been reviewed and it has been decided as under: Repo in corporate debt shall also be permitted on Commercial Papers, Certificates of Deposit and Non Convertible Debentures of less than one year of original maturity. The minimum haircut, applicable on the market value of the corporate debt securities prevailing on the date of trade of 1st leg, has been revised as under: Rating AAA AA+ AA Existing Minimum Haircut 10% 12% 15% Revised Minimum Haircut 7.5% 8.5% 10% The above are minimum stipulated haircuts where the repo period is overnight or where the remargining frequency (in case of longer tenor repos) is daily. In all other cases, the participants may adopt appropriate higher haircuts. 3. The Directions {Repo in Corporate Debt Securities (Amendment) Directions, 2013} issued in this regard vide IDMD.PCD. 08/14.03.02/2012-13 dated January 4, 2013 are enclosed . Yours faithfully, (K K Vohra) Chief General Manager RESERVE BANK OF INDIA INTERNAL DEBT MANAGEMENT DEPARTMENT 23rd FLOOR CENTRAL OFFICE FORT MUMBAI 400 001 Mumbai, January 4, 2013 Repo in Corporate Debt Securities (Amendment) Directions, 2013 In exercise of the powers conferred by Section 45 W of the Reserve Bank of India Act, 1934 and in partial modification of the notification No IDMD.DOD. 04 /11.08.38/2009-10 dated January 8, 2010 as amended from time to time, the Reserve Bank hereby makes the following further amendments to amend the Repo in Corporate Debt Securities (Reserve Bank) Directions, 2010 (hereinafter referred to as the said Directions) namely: 2. (i) In Paragraph 3 of the said Directions:- (a) for sub paragraph (a), the following shall be substituted: “(a) Listed corporate debt securities of original maturity of more than one year which are rated ‘AA’ or above by the rating agencies, that are held in the security account of the repo seller, in demat form shall be eligible for undertaking repo; “ (b) and the following sub paragraph shall be added after sub paragraph (a): “ (b) Commercial Papers (CPs), Certificates of Deposit (CDs) and Non-Convertible Debentures (NCDs) of less than one year of original maturity shall also be permitted as eligible security for undertaking repo in corporate debt. Listing requirement indicated in sub paragraph (a) of this paragraph will not be applicable but rating requirement as specified shall apply also for these money market instruments to be eligible as security for undertaking repo in corporate debt.” (ii) In Paragraph 10 of the said Directions, for sub paragraph (a) the following shall be substituted: “ (a) A rating based haircut as under (or higher as may be decided by the participants depending on the term of the repo and the remargining frequency) shall be applicable on the market value of the corporate debt security prevailing on the date of trade of 1st leg.” Rating AAA AA+ AA Minimum haircut 7.5 % 8.5% 10% 3. These Directions may be referred to as the Repo in Corporate Debt Securities (Amendment) Directions, 2013 and the modifications made therein shall be effective from January 8, 2013. (R Gandhi) Executive Director Ref. IDMD.PCD. 08 /14.03.02/2012-13 Note:- The principal notification No. IDMD.DOD.04/11.08.38/2009-10 dated January 8, 2010 was amended vide Notification No IDMD.PCD.21/11.08.38/2010-11 dated November 9, 2010. 2026 All Months January February March April May June July August September October November December 2025 All Months January February March April May June July August September October November December 2024 All Months January February March April May June July August September October November December 2023 All Months January February March April May June July August September October November December 2022 All Months January February March April May June July August September October November December 2021 All Months January February March April May June July August September October November December 2020 All Months January February March April May June July August September October November December 2019 All Months January February March April May June July August September October November December 2018 All Months January February March April May June July August September October November December 2017 All Months January February March April May June July August September October November December Archives 2016 All Months January February March April May June July August September October November December 2015 All Months January February March April May June July August September October November December 2014 All Months January February March April May June July August September October November December 2013 All Months January February March April May June July August September October November December 2012 All Months January February March April May June July August September October November December 2011 All Months January February March April May June July August September October November December 2010 All Months January February March April May June July August September October November December 2009 All Months January February March April May June July August September October November December 2008 All Months January February March April May June July August September October November December 2007 All Months January February March April May June July August September October November December 2006 All Months January February March April May June July August September October November December 2005 All Months January February March April May June July August September October November December 2004 All Months January February March April May June July August September October November December 2003 All Months January February March April May June July August September October November December 2002 All Months January February March April May June July August September October November December 2001 All Months January February March April May June July August September October November December 2000 All Months January February March April May June July August September October November December 1999 All Months January February March April May June July August September October November December 1998 All Months January February March April May June July August September October November December 1997 All Months January February March April May June July August September October November December 1996 All Months January February March April May June July August September October November December 1995 All Months January February March April May June July August September October November December 1994 All Months January February March April May June July August September October November December 1993 All Months January February March April May June July August September October November December 1992 All Months January February March April May June July August September October November December 1991 All Months January February March April May June July August September October November December Top Back to previous page More Links : Bank Holidays Banking Glossary Citizen's Charter Complaints Contact Us COVID-19 Measures E-LMS Events FAQs Financial Education Forms IFSC/MICR Codes Important Websites Opportunities @ RBI RBI Clarifications RBI Kehta Hai RBI’s Vision and Values (1257 kb)--> Right to Information Act Tenders Follow RBI RSS Twitter YouTube Instagram Facebook LinkedIn &copy; Reserve Bank of India. 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Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2012-13/365 · issued 07 Jan 2013. The plain-English explanation above is BankPulse’s own independent summary.

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=7792&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.