What is RBI's Direct Retail Scheme? Know All The Details

On November 12, 2021, the Hon'ble Prime Minister, Shri Narendra Modi via virtual mode launched the RBI's ambitious scheme the Retail Direct Scheme. The Reserve Bank of India's (RBI) Retail Direct scheme is designed as a one-stop-shop for private investors looking to buy or invest in government securities. On the same date of its launch, RBI also announced the activation of the Scheme.

The RBI Retail Direct Scheme allows retail investors to purchase and sell government securities (G-sec) on the primary and secondary markets over the internet. These small investors can now invest in G-Secs by creating a gilt security account with the RBI, according to data published by the RBI. The new account will be known as the Retail Direct Gilt (RDG) Account.

The scheme aims to improve individual investors' access to the government securities market. It provides ordinary investors with a new way to invest directly in securities issued by the federal and state governments. This scheme could help in promoting financial inclusion by bringing money from the unorganised sector into the capital market. IYou can also go for Alternatives of RBI Reatil Direct Schmes available in India.

Scope of the Scheme

a. 'RBI Retail Direct' is a comprehensive scheme that provides the following
facilities to retail investors in the government securities market through an online
portal:
i. Open and maintain a 'Retail Direct Gilt Account' (RDG Account)
ii. Access to primary issuance of Government securities
iii. Access to NDS-OM

Eligibility

a. Retail investors, as defined under the scheme, can register under the Scheme and maintain an RDG Account, if they have the following:
i. Rupee savings bank account maintained in India
ii. Permanent Account Number (PAN) issued by the Income Tax Department
iii. Any OVD for KYC purpose
iv. Valid email id
v. Registered mobile number.
b. Non-Resident retail investors eligible to invest in Government Securities under Foreign Exchange Management Act, 1999 are eligible under the scheme.
c. The RDG account can be opened singly or jointly with another retail investor who
meets the eligibility criteria

Registration and Procedure

To register yourself into RBI's Retail Direct Scheme all you need to fulfil the eligibility criteria and have all the required documents with you at the time of registration. Registration procedure can be done by visiting online the dedicated portal of the scheme on the following link: rbiretaildirect.org.in/

After visiting the portal, the investor must enter information such as his or her name, PAN card number, phone number, email address, and bank account number. A tracking number is assigned after OTP validation of the mobile number and email address. Following that, the investor's KYC (and, in the case of joint accounts, all holders' KYC) is validated, as well as the investor's bank account. The RDG account is established in the investor's name once the process is finished.

After completing all the registration steps the investor will get an email confirmation with his or her account number, login id, and password on their respective email address, which will allow him or her to access the online portal and use its features.

Fee and charges

a. No fee will be charged for opening and maintaining 'RDG account' with
RBI.
b. No fee will be charged by the aggregator for submitting bids in the primary auctions.
c. Fee for payment gateway etc., as applicable, will be borne by the registered
investor.