Reserve Bank of India (Standalone Primary Dealers) Directions, 2025 (Updated as on March 10, 2026)
UR
- Applies toPrimary dealers and finance companies · read from RBI’s Para 3
- StatusIn force
- ImportanceMUST READ
- IssuedNov 28, 2025
- Last amendedJun 24, 2026 · 2 incorporated
- Length58 points in 1 section · 6 min read
The four dates on this rule
- PublishedNov 28, 2025The day RBI put this document out.
- Starts to applyNot statedNot stated separately in this document. Read the rule itself before you assume a start date.
- Time to get readyNot statedCannot be worked out until the day it starts to apply is known.
- Last date to actNot statedNo date to act by was found in this document. Other dates may sit inside single paragraphs.
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Numbers to remember
| ₹10 crore | RBI sets ₹10 crore as the net owned fund needed to start as an NBFC. RBI Para 13 |
| 15 per cent | An SPD must always hold a minimum CRAR of 15 per cent. RBI Para 16 |
| 50 per cent | Subordinated debt counted as Tier 2 capital cannot exceed 50 per cent of Tier 1 capital. RBI Para 97 |
| 100 per cent | Total Tier 2 capital can never exceed 100 per cent of Tier 1 capital. RBI Para 98 |
| 225 per cent | An SPD may borrow up to 225 per cent of its NOF in call money. RBI Para 107 |
| 25 per cent | An SPD may lend up to 25 per cent of its NOF in that market. RBI Para 107 |
| 150 per cent | Inter-corporate deposit borrowing can never exceed 150 per cent of NOF. RBI Para 108 |
| ₹150 crore | An SPD doing only core activities must hold at least ₹150 crore NOF. RBI Para 115 |
| ₹250 crore | An SPD doing non-core activities too must hold at least ₹250 crore NOF. RBI Para 115 |
| ₹500 crore | A CDS market maker needs Net Owned Funds of ₹500 crore and CRAR of 15 per cent. RBI Para 125 |
| 10 per cent | All of an SPD's unlisted non-G-Sec investments together cannot exceed 10 per cent of that portfolio. RBI Para 134 |
| one year | Money placed with an SPD for portfolio management stays for at least one year. RBI Para 141(2) |
| 40 per cent | Exposure to a single borrower cannot exceed 25 per cent of Tier 1 capital. A group borrower's cap is 40 per cent. RBI Para 159(1) |
| 65 per cent | For AAA-rated corporate bonds, the single-borrower cap rises to 50 per cent. The group cap rises to 65 per cent. RBI Para 159(1) |
What it says
Chapter I. Preliminary
1. Who these rules cover
These Directions apply to every Standalone Primary Dealer registered as an NBFC with RBI.
2. Always in the Middle Layer
An SPD always sits in RBI's Middle Layer for NBFC regulation.
3. Directions took effect at once
These Directions started applying immediately, from the day they were issued.
4. Other RBI rules still apply
Rules from any other RBI department that cover an SPD must still be followed.
Chapter II. Registration
1. Board approves its policies
The SPD's Board must approve its own governance policies.
2. Ten crore to register
RBI sets ₹10 crore as the net owned fund needed to start as an NBFC.
Chapter III. Capital Funds and Capital Requirements
Must know
1. Minimum CRAR, 15 per cent
An SPD must always hold a minimum CRAR of 15 per cent.
2. Equity risk uses one method
For equity and equity derivatives, an SPD must use the Internal Models approach only.
3. Forex risk charge
Forex net open positions carry a market risk capital charge of 15 per cent.
4. Capital charge always held
The capital charge for credit and market risk must be maintained at all times.
5. Tier 2 subordinated debt cap
Subordinated debt counted as Tier 2 capital cannot exceed 50 per cent of Tier 1 capital.
6. Tier 2 capital ceiling
Total Tier 2 capital can never exceed 100 per cent of Tier 1 capital.
Background
7. Deducted assets get zero weight
Capital already deducted from the fund carries a zero risk weight.
8. Net long and short positions
Long and short positions in the same security are reported on a net basis.
Chapter IV. Sources and Application of Funds
Must know
1. Call money borrowing cap
An SPD may borrow up to 225 per cent of its NOF in call money.
2. Call money lending cap
An SPD may lend up to 25 per cent of its NOF in that market.
3. ICD borrowing cap
Inter-corporate deposit borrowing can never exceed 150 per cent of NOF.
4. No placing funds in ICDs
An SPD may never place its own funds in the ICD market.
5. FCNR(B) loan cap
FCNR(B) loans cannot exceed 25 per cent of an SPD's NOF.
6. No external commercial borrowing
An SPD may not raise funds through External Commercial Borrowings.
7. Core-only NOF floor
An SPD doing only core activities must hold at least ₹150 crore NOF.
8. Non-core NOF floor
An SPD doing non-core activities too must hold at least ₹250 crore NOF.
9. Half of investments in G-Sec
An SPD must keep at least 50 per cent of its investments in G-Sec.
10. No repo with own constituent
An SPD may not repo corporate debt with its own constituent.
11. CDS market maker minimums
A CDS market maker needs Net Owned Funds of ₹500 crore and CRAR of 15 per cent.
12. Corporate bond sub-limit
Within that call-money limit, corporate bond investment is capped at 50 per cent of NOF.
13. No unrated non-G-Sec
An SPD may not invest in unrated non-G-Sec securities.
14. Unlisted non-G-Sec cap
All of an SPD's unlisted non-G-Sec investments together cannot exceed 10 per cent of that portfolio.
15. PMS needs a clear mandate
For portfolio management, the SPD must get a clear client mandate and follow it.
16. PMS carries no guarantee
Portfolio management is entirely at the customer's own risk, with no return guaranteed.
17. PMS funds held one year
Money placed with an SPD for portfolio management stays for at least one year.
18. PMS client funds segregated
Client money in portfolio management is kept separate from the SPD's own funds.
19. PMS deals at market rates
Every PMS transaction, with a client or between clients, is done at market rates.
20. No margin payments for clients
An SPD may not pay margins for clients or carry overnight credit exposure to them.
21. Currency futures position limit
An SPD's EUR-INR position may not exceed 15 per cent of total open interest.
Do it
22. ICDs run one week minimum
Every inter-corporate deposit an SPD accepts must run at least one week.
23. Hedge half the FCNR risk
SPDs must hedge at least 50 per cent of that FCNR exposure at all times.
24. NCDs up to one year
An SPD can issue one-year NCDs without a bank working-capital limit.
25. Report swaps within 30 minutes
An SPD must report its IRS and FRA trades to CCIL within 30 minutes.
26. Report bond trades fast
OTC trades in corporate bonds must be reported within 15 minutes of the trade.
27. Board reviews investments quarterly
The SPD's Board must review its non-G-Sec investments at least every quarter.
28. Clearing services need SEBI nod
An SPD needs SEBI's specific approval to offer clearing or custodial services.
29. Board approves FX policy
The SPD's Board must approve its own foreign exchange policy.
Background
30. Brokers stay out of settlement
A broker who arranges a deal plays no part in settling it.
Chapter V. Other Prudential Regulations
Must know
1. Securities marked to market
Every security in the trading book is marked to market regularly.
2. Single and group exposure caps
Exposure to a single borrower cannot exceed 25 per cent of Tier 1 capital. A group borrower's cap is 40 per cent.
BankPulse example. Suppose an SPD's Tier 1 capital is ₹200 crore. Its exposure to a single borrower may be up to 25 per cent of that, which is ₹50 crore. Its exposure to one borrower group may be up to 40 per cent, which is ₹80 crore.
3. AAA bond exposure caps
For AAA-rated corporate bonds, the single-borrower cap rises to 50 per cent. The group cap rises to 65 per cent.
Background
4. Valuation stays independent
Valuing the securities book is kept separate from the dealing desk.
5. Government-guaranteed exposure has no cap
Exposure limits do not apply where the Government of India fully guarantees the loan.
6. QCCP clearing sits outside cap
Clearing exposure to a qualifying CCP sits outside the normal 25 per cent limit.
Chapter VI. Governance Issues – Corporate Governance
1. Publish audited results
An SPD must publish its audited annual results in leading financial dailies.
2. Penalties go public
When RBI fines an SPD, it issues a public press release naming the reasons.
Chapter VII. Miscellaneous Instructions
1. Broker limit, five per cent
No single broker may handle more than five per cent of yearly transactions.
2. Broker panel reviewed yearly
Top management approves the broker panel, reviewed at least once a year.
3. Broker records must be kept
The SPD keeps a broker-wise record of every deal and the brokerage paid.
4. Broker's role stays limited
A broker only brings the two sides of a deal together, nothing more.
Chapter IX. Repeal and Other Provisions
1. Old repeals stay repealed
Directions already repealed earlier stay repealed under this rulebook too.
2. RBI's word is final
If a rule is unclear, RBI's own interpretation of it is final and binding.
How this rule has changed
The points above are the rule as it stands today, after every change listed here.
Issued on Nov 28, 2025. This is the date RBI put the rule out.
Changed on Mar 10, 2026.
- Tier 1 capital meaning. Tier 1 capital is paid-up capital, statutory reserves and other free reserves plus allowed quarterly profit.
- Dividend adjustment rule. Eligible quarterly profit must reduce the average dividend paid in the last three financial years.
- Losses in year deduction. Any loss in the current year must be fully reduced from Tier 1 capital.
- Mandatory deductions list. Investments in subsidiaries, intangibles, tax assets and carried losses must be cut from Tier 1 capital.
Changed on Jun 24, 2026.
- Start date. These new amendment rules will apply from April 1, 2027.
- Daily capital need. A standalone primary dealer must hold foreign exchange risk capital every business day close.
- Excluded capital items. A standalone primary dealer must not count positions deducted from regulatory capital for foreign exchange risk capital needs.
- Excluded bad securities. A standalone primary dealer must not apply foreign exchange risk capital to matured unpaid or non performing foreign currency securities.