UPSC Prelims Practice Questions — OTC derivatives: RBI defers Unique Transaction ID

Q1. With reference to the Unique Transaction Identifier (UTI) framework for OTC derivative transactions notified by the RBI in February 2026, consider the following statements: 1. The UTI is an alphanumeric code of up to 52 characters that incorporates the Legal Entity Identifier (LEI) of the generating entity. 2. The technical specifications of the UTI are aligned with the guidance issued jointly by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO). 3. The Securities and Exchange Board of India (SEBI) is the regulator empowered to administer the UTI regime for OTC derivatives in India. 4. Where a reportable OTC derivative transaction is submitted to the CCIL Trade Repository without a UTI, the CCIL-TR itself shall generate the UTI for that transaction. Which of the statements given above are correctly identified?

  1. The UTI is an alphanumeric code of up to 52 characters that incorporates the Legal Entity Identifier (LEI) of the generating entity.
  2. The technical specifications of the UTI are aligned with the guidance issued jointly by CPMI and IOSCO.
  3. The Securities and Exchange Board of India (SEBI) is the regulator empowered to administer the UTI regime for OTC derivatives in India.
  4. Where a reportable OTC derivative transaction is submitted to the CCIL Trade Repository without a UTI, the CCIL-TR itself shall generate the UTI.
  • A. 1, 2 and 4 only
  • B. 1, 3 and 4 only
  • C. 2 and 3 only
  • D. 1, 2, 3 and 4

Q2. In the context of India's financial markets, the term 'Unique Transaction Identifier (UTI)', which was recently in the news, refers to:

  • A. A 20-character ISO-compliant code assigned to a legal entity participating in financial market transactions
  • B. A globally unique alphanumeric code, up to 52 characters long, assigned to each OTC derivative transaction to track it through its lifecycle
  • C. A token-based digital identifier issued by the RBI for wholesale Central Bank Digital Currency (CBDC) settlements
  • D. A unique alphanumeric code allotted by SEBI to each corporate bond issuance listed on Indian stock exchanges

Q3. As per the RBI's final Directions on the Unique Transaction Identifier (UTI) for OTC derivative transactions, the UTI assigned to a transaction shall have a maximum length of how many characters?

  • A. 20 characters
  • B. 32 characters
  • C. 52 characters
  • D. 64 characters

Q4. With reference to the Unique Transaction Identifier (UTI) regime and the Legal Entity Identifier (LEI) regime for OTC derivative market participants in India, consider the following statements: 1. The RBI's October 2025 draft directions had proposed an effective date of April 1, 2026 for the UTI mandate, but the final directions issued in February 2026 deferred the effective date to January 1, 2027. 2. While the LEI is a transaction-level identifier generated afresh for every OTC derivative trade, the UTI is an entity-level identifier issued once to each counterparty. 3. The UTI conforms to technical guidance issued by CPMI-IOSCO, whereas the LEI is based on the ISO 17442 standard. Which of the statements given above is/are correct?

  1. The RBI's October 2025 draft directions had proposed an effective date of April 1, 2026 for the UTI mandate, but the final directions issued in February 2026 deferred the effective date to January 1, 2027.
  2. While the LEI is a transaction-level identifier generated afresh for every OTC derivative trade, the UTI is an entity-level identifier issued once to each counterparty.
  3. The UTI conforms to technical guidance issued by CPMI-IOSCO, whereas the LEI is based on the ISO 17442 standard.
  • A. 1 only
  • B. 1 and 2 only
  • C. 1 and 3 only
  • D. 1, 2 and 3