According to a press release on Friday, the Reserve Bank of India (RBI) has released draft guidelines on government securities lending.

In its latest monetary policy statement in December, the central bank announced it would allow the borrowing of government securities, expanding the existing markets for “special repos”.

The system is expected to facilitate broader participation in the securities lending market by providing investors with the means to deploy idled securities and enhance portfolio returns.

“Government securities lending transactions have a minimum tenor of 1 day and a maximum of 90 days.

According to the draft guidance, ” transactions may use any mutually agreed transaction process, including bilateral or multilateral, quote-driven or order-driven processes, anonymous or otherwise,” according to the draft guidance.

The central bank has invited banks, market participants and other stakeholders to comment on the draft instructions by March 17.