Role of Clearing Corporation in Indian financial market development

Abstract

The Clearing Corporation of India (CCIL) was set up with the prime objective to improve efficiency in the transaction settlement process, insulate the financial system from shocks emanating from operations related issues, and to undertake other related activities that would help to broaden and deepen the Money, Gilts and Forex markets in India. The role of CCIL is unique as it provides guaranteed settlement of three different products under one umbrella. It has been instrumental in setting up and running NDS-OM, NDS-Call and NDS-Auction system for the central bank that had helped the Indian market to evolve and grow immensely. It had also immensely bolstered CCIL's image in terms of ability to provide transparent, efficient, robust and cost effective end to end solutions to market participants in various markets. The success of its money market product `CBLO' has helped the market participants as well as the central bank to find a solution to unusual dependence on uncollateralized call market. CCIL has introduced many innovative products/tools like ZCYC, Bond and Tbills indices, Sovereign Yield Curve, Benchmark reference rates like CCIL-MIBOR/MIBID and CCBOR/CCBID.

Keywords:

• Clearing Corporation
• clearing and settlement
• India
• novation
• gilts
• forex