RBI Allows SRVA Investors to Access Indian Corporate Debt Securities

On October 3, 2025, the Reserve Bank of India (RBI), allowed persons residing outside India to use their surplus rupee balances in Special Rupee Vostro Accounts (SRVAs) to invest in corporate debt securities issued by Indian companies through its Circular No. RBI/2025-26/90. This is a significant change to the previous structure whereby SRVA holders were only allowed to invest in government securities.

• Objective and Application

The main objective of this reform is to open the debt market in India to foreign investors and help in the overall objective of rupee internationalisation. This circular is applicable to all SRVA holders with accounts in Authorised Dealer Category-I banks (AD Banks), who can now invest their surplus in rupee in non-convertible debentures (NCDs), corporate bonds and commercial papers (CPs) with the aggregate investment limit of 15% on Foreign Portfolio Investors (FPIs). 

• Key Features of the Circular 

1. 1. Wider Investment Options: SRVA holders can now invest in corporate debt instruments of any maturity, including short-term CPs. This removes the one-year minimum maturity requirement applicable to FPIs. 

1. 2. No Issue-Wise Limits: The circular removes individual issuance caps, allowing SRVA investors to put larger amounts into a single corporate debt issuance if they choose. 

1. 3. Simpler Regulatory Route: SRVA investors do not need an FPI licence. AD banks will open dedicated demat accounts, handle reporting, and ensure compliance with RBI, SEBI, and exchange control laws. 

Further, another RBI circular bearing reference number RBI/2025-26/91 A.P. (DIR Series) Circular No. 14, also dated 3 October, 2025, titled “International Trade Settlement in Indian Rupees (INR)”, complements the SRVA framework. It allows AD banks to enable investment of surplus SRVA balances in NCDs, bonds, and CPs issued by Indian entities. Together, these measures create regulatory synergy between INR-based trade settlements and capital market access, furthering the policy goal of rupee internationalization and capital market deepening. 

Conclusion

This move opens the corporate debt market to a new class of foreign investors and is expected to improve liquidity and foreign participation. It also supports India’s long-term plan to strengthen the global use of the rupee.