May 30, 2019

The Reserve Bank of India (RBI) constituted a task force to suggest policy and regulatory interventions required for development of secondary market in corporate loans.


  • Official name: Task Force on the Development of Secondary Market for Corporate Loans.

  • Composition: The six-member body is headed by Canara Bank chairman T. N. Manoharan.

  • Terms of Reference: To make recommendations on –
    • required policy/regulatory interventions for facilitating development of secondary market in corporate loans, including loan transaction platform for stressed assets; and

    • creation of a loan contract registry to remove information asymmetries between buyers and sellers.

  • Timeline: The task force has been asked to submit its report by the end of August 2019.

Need of task force:

  • Secondary loan market in India is largely restricted to asset reconstruction companies (ARCs) and ad hoc sale to other lenders, including banks, and no formalised mechanism has been developed to deepen the market.

  • A well-developed secondary market for debt will also aid in the transparent price discovery of the inherent riskiness of the debt being traded.