On Monday the Reserve Bank of India announced sale of three government securities Of totalling Rs 30,000 crore. The securities will be sold by Reserve Bank of India from Mumbai branch on 21st August.
“The three dated securities for a notified amount of Rs 30000 crore is going to be sell by the Government of India…..,”the RBI said, adding that the government will have choice to retain additional subscription up to Rs 2,000 crore against each security.
It further specified that both the bid of auction either competition or non-competition should be submitted in electronic format on the RBI core Banking Solution (E- Kuber) system on August 21.
The RBI said, “The result will be announced on the same day and payment by successful bidder will have to be made on August 24, 2020(Monday).
The successful bid have to accept their respective quoted price for the security as the auction will be a multiple price-based.
The central bank said, “The stocks will be issued for minimum amount of Rs 10000 (nominal) and in multiples of Rs 10,000 thereafter.”
During the auctions, government stock to 5 per cent of the notified amount of sale will be alloted to the eligible individuals and institutions under the scheme for non-competitive biding facility in the aution of the government securities.
To increase the number of participants and retail holdings of government securities , retail investor are allowed to participate on “non-compititive” basis on selected auctions of dated Government of India securities and Treasury Bills.
To increase and diversify the investor base for government securities the RBI and government have been talking about various measures to encourage participation of retail investors in G- Sec market, including introduction of non-competitive biding in primary auction.
