Banking Awareness Study Notes on Gilt Accounts

Gilt Accounts

Banking Awareness is considered to be the high scoring section in any competitive exam. It includes two main portions, current affairs GK and static GK. In this article, we will discuss some really important Banking Awareness topics that are covered in almost all competitive exams. Also, you can download the PDF of lists of different Banking Awareness topics.

 In Banking Section, the questions are asked from following topics: History of Banking, banking terms, Marketing of Banking Products, Functions of Banks, Banks and their taglines, schemes, committees related to banking, headquarters of bank, some Banking news related, apps launched by banks, new schemes etc. 

In a series of sharing useful study material for upcoming banking exams. Here, we are providing Banking Awareness notes for all banking Exams (IBPS, SBI & Other Banking Exams).

Banking Awareness Study Notes on Gilt Accounts

A “Gilt Account” means an account opened and maintained for holding Government securities, by an entity or a person including ‘a person resident outside India’ with a “Custodian” permitted by the Reserve Bank of India to open and maintain Constituent Subsidiary General Ledger Account with the Public Debt Office of the Reserve Bank of India. However, in case of a ‘Person resident outside India, the activities in the operations/maintenance of Gilt Account shall be governed by the Foreign Exchange Management Act, 2000 and the regulations
framed thereunder.

 A “Constituent” or a ‘Gilt Account Holder (GAH) means an entity or a person including ‘a person resident outside India’ maintaining a “Gilt Account” with a “Custodian”.

The GAHs permitted by RBI include NBFCs, Provident Funds, Pension Funds, Mutual Funds, Insurance Companies, Cooperative Banks, Regional Rural Banks, Trusts, Corporates, and Individuals etc. who are non-NDS members. A GAH is entitled to open only one Gilt Account having a unique account number with any of the Custodians. A declaration to that effect must be submitted by GAH to the Custodian and a copy thereof may be submitted to the RBI (Public Debt office, Mumbai). A GAH may also maintain a demat account with the Depositories through Depository Participant (DP) for facilitating retail trading in Government Securities through Stock Exchanges.

The Gilt Account Holder (GAH) is permitted to maintain a fund account with its Custodians or designate a fund account with a bank other than the Custodian specifically for settlement of Government Securities transactions, by making available all the details of the designated fund account to the Custodian. The Gilt Accounts are opened/maintained by Custodian shall satisfy the eligibility conditions for holding Government securities as specified in the General Notifications F.No. 4(9)-W&M/ 2000 dated 6th May 2002 and announcements by the RBI relating to investments by Foreign Institutional Investors (FIIs).