XTRAS: Retail Direct Scheme or RDS clocked over 12,000 registrations on its launch day November 12, 2021.
Retail Direct Scheme is a one-stop solution to facilitate investment in Government securities by individual investors directly in the primary market (auctions) and secondary market. Under this scheme, individual retail investors can open a Gilt Securities Account – “Retail Direct Gilt (RDG)” – account with RBI and buy and sell government securities through online portal https://rbiretaildirect.org.in
Kinds of Govt. Securities: Government of India Treasury Bills (T-Bills), Government of India dated securities (dated G-Sec), State Development Loans (SDLs), Sovereign Gold Bonds (SGB).
PROS:
• India will be the first country in Asia to give access of G-Secs to Retail Investors.
• It will deepen the base of Bond Market as more funds will be available with the corporates who can raise financing from Markets without Govt. borrowing disruption.
• No fees will be charged for facilities provided under the scheme. Easy and convenient methods of payment for transactions given.
• It will give investors moderate and safe returns.
CONS:
• Higher yields than fixed deposits can cause disintermediation of the fixed deposit markets.
• With the exception of sovereign gold bonds, there are no tax benefits for investment in Government bonds through this platform.
• The liquidity in the secondary market for small quantities of such bonds also tends to be poor.
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