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CS Professional · IFSCA - Regulations, Listing and Compliances · India International Bullion Exchange (IIBX)

Himalaya Bullion Traders, an Indian entity, applies to become a trading-cum-clearing member on IIBX. Which fact about the clearing function is correct?

Trades on IIBX are cleared and settled through a recognised clearing corporation, and clearing members are connected to it. Members do not clear privately, and the RBI does not perform this function; settlement relates to bullion held in designated vaults.

  1. AClearing and settlement of IIBX trades is handled through the recognised clearing corporation, and a clearing member is linked to that clearing corporationCorrect
  2. BClearing is done by each trading member privately without a clearing corporation
  3. CClearing is performed only by the RBI in Mumbai
  4. DClearing is not needed because delivery is always physical at the shop

Explanation

IIBX trades are cleared and settled through a recognised clearing corporation (India International Clearing Corporation), with clearing members connected to it. Private bilateral clearing or RBI clearing is not the model, and settlement is vault-based rather than at a shop.

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