Global lenders pushed back against a proposal by the Reserve Bank of India (RBI) for more reporting of offshore rupee trades, according to people familiar with the matter.
Banks told the RBI the proposal could breach client confidentiality and conflict with data and reporting rules in other jurisdictions, the people said, asking not to be named discussing private matters. They submitted written feedback by the March 9 deadline through two international financial industry associations, the people said.
What the new rules say
In a Feb. 16 draft of the rules, the Reserve Bank of India asked banks to report more details of derivative trades linked to the rupee that are conducted outside the country. Lenders would need to report at least 70% of such transactions — which have grown to an average of more than $149 billion a day — within a year of the rules taking effect.
Banks told the RBI that the new rules would require major changes to their systems, data formats and legal agreements, given the scale of daily trading in the offshore currency market, the people said. Some lenders said they may only be able to share information for clients who explicitly consent to the disclosures, the people said.
A spokesperson for the RBI did not respond to an email seeking comment.
The offshore rupee market has expanded rapidly, with trading in hubs such as Singapore, London and Hong Kong now more than double onshore volumes, according to a 2025 Bank for International Settlements report. Because much of this activity takes place beyond India’s direct regulatory reach, the RBI has limited visibility into large positions that can influence the currency.
Sharp moves abroad have at times spilled back into domestic markets, complicating the central bank’s efforts to manage volatility. Last month, Governor Sanjay Malhotra said the RBI would step in if speculative pressure against the rupee intensifies.
The reporting proposal follows a similar move last year requiring banks to disclose details of offshore interest-rate swap trades. That rule also drew objections from global lenders over confidentiality and jurisdiction, though the RBI has kept its phased implementation timeline in place.
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