RBI To Launch Retail Direct Mobile App For G-Secs, Here’s How Retail Investors Can Benefit

RBI today announced that it will soon launch a mobile application that will allow direct investment in government securities through RBI Retail Direct
RBI To Launch Retail Direct Mobile App For G-Secs
RBI To Launch Retail Direct Mobile App For G-Secs

The Reserve Bank of India (RBI) on April 5, 2024 announced after its monetary policy committee (MPC) meeting that it will soon launch a mobile application for accessing the Retail Direct portal.

RBI Retail Direct is a one-stop solution for retail investors to invest in government securities.

“To further improve the ease of access, a mobile application of the Retail Direct portal is being developed. The app will enable investors to buy and sell instruments on the go, at their convenience. The app will be available for use shortly,” RBI said.

The mobile application will allow investors to invest in different types of government securities, such as central govt bonds, state government bonds, Treasury bills, and sovereign gold bonds (SGBs), among others. Investors can access the primary and secondary market for all these instruments through the RBI Retail Direct portal.

Says Venkatakrishnan Srinivasan, founder of Rockfort Fincap LLP, a financial advisory firm focusing on debt investments: “The mobile app provides retail investors with easy access to the G-sec market directly through RBI's Retail Direct Scheme, which will make the process more straightforward and convenient for retail investors.”

The application is likely to include features, such as account management, investment tracking, direct credit of interest and principal to customers’ bank account and online customer support, according to Srinivasan.

Retail investors can also enjoy lower transaction costs, thus enhancing their returns, as it will cut down on intermediaries and their commissions, he added.

Further RBI's direct involvement in bringing out the application will also foster confidence in investors.

RBI Retail Direct

Launched in 2021, RBI Retail Direct is an investor friendly, Netbanking and UPI-enabled Web platform where a retail investor can invest in govt securities by logging on the RBI Retail Direct website.

One can open and maintain a retail direct gilt account free of charge and participate easily in primary issuances, as well as trade government securities in secondary market without any intermediaries.

Under the Retail Direct Scheme, retail investors can open a gilt account with the RBI if they have a savings bank account in India, a Permanent Account Number (PAN), apart from email id and a valid phone number. They must provide any officially valid document for KYC, such as Aadhaar, Passport, Voter ID, etc.

The RBI Retail Direct Gilt Account can be opened either in single or in a joint holding mode. Even non-resident retail investors can invest in government securities via this route.

Meanwhile, the yield on government bonds, particularly the benchmark one of 10-year maturity, remained stable amid the monetary policy announcement on April 5, 2024.

The 10-year benchmark bond yield opened at 7.08 per cent, marginally higher than close of 7.09 per cent. The yield on 10-year benchmark 7.18 per cent 2033, is currently at 7.11 per cent.

The RBI kept the repo rate unchanged for the seventh time consecutively at 6.50 per cent.

"The central bank's strategy reflects careful consideration of robust economic indicators amid factors, such as monsoon performance, US Federal Reserve decisions, and overall economic growth, thus ensuring continued high growth prospects for the country. It is expected that rates will potentially adjust towards the end of this year when inflation moderates and the food inflation remains within expected parameters,” said Adhil Shetty, CEO, Bankbazaar.com.

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